Question

George purchases goods on credit from Hardeep for £1,000. £100 of these goods are defective and George returns them to Hardeep. What document would Hardeep issue to George in respect of the returned goods?

A Invoice
B Remittance advice
C Credit note
D Delivery note

Answer 1

Hardeep would issue a Credit Note to George for the returned defective goods, which serves as an acknowledgment of the return and adjusts the accounts appropriately.

Step-by-step explanation:

When George returns the defective goods worth £100 to Hardeep, Hardeep would issue a Credit Note to George. This document serves as an acknowledgment that the goods have been returned and reduces the amount owed by George by £100. The Credit Note effectively reverses part of the original transaction and adjusts the accounts accordingly.

When George returns the defective goods to Hardeep, Hardeep would issue a credit note to George. A credit note is a document used to inform the buyer that the seller has credited their account for the value of returned goods or services. It serves as a proof of the return and allows the buyer to deduct the amount from their outstanding balance with the seller.