Answer:
Debit : Supplier $200
Credit : Purchases Returns and Allowances $200
Explanation:
We normally debit the Supplier account when we want to reduce our entity`s liability.
We reduce the entity liability when :
- The suppliers have been paid amount due to them
- The entity has returned goods to suppliers
The above journal depicts a return of goods to suppliers from the entry view of the Customer.
The Supplier has to reduce their Sales Account with the same amount of $200, the value of the goods returned.
