A/C entry

What will be the accounting entry for Goods returned to factory for repair work initially sold on warranty

Replies (2)

In my opinion, there should be no accounting entry.

There shall be no accounting entry for receiving the goods for repair. However,expenses incurred on repair shall be debited to corresponding expenditures.

 

Further, the follwoing entry may be made at the end of financial year to incorporate the goods so received in the balance sheet.

Goods received for repair                                         Dr.

        To Customers' a/c for goods held for repair

 

at the beggining of next financial year, the above entry shall be reversed.

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