Debtors & Creditors Accounting Quiz

Debtors & Creditors Accounting Quiz Explained

John has sent two invoices in October. The third invoice is not relevant as it is dated november. So, John’s total sales to Anderson during the month was $1000+$500=$1,500.

However if you note carefully John has also sent credit note to anderson amounting $200.

When a seller (supplier) sends a credit note to his customer (debtor). It means the seller is acknowledging the goods returned to him from the buyer. There may be other reasons for a credit note like adjustment of price. However for the sake of simplicity we can assume that whatever be the reason of a credit note, the result was a credit in receivables account (Anderson’s Account) in the Books of John.

Answer:

Therefore we can reach the net sales or net receivables as $1500-$200=$1300. 

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