Returns & Allowances

Returns and allowances are a group of offsetting entries to sales. Returns reflect customer choices and a physical return of an item. Allowances on the other hand relate to business to business relationship issues. Often allowances are given to business based customers for some form of improper delivery (timing or location) or for the incorrect number of units or types of units. An example is providing a dollar offset to the sale of paint from a supplier to a painter because the tint of the white is slightly off. The painter will use the existing white as the base coat and get the correct tint for the final coat.

error: Content is protected !!