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Dear Sir,
1) Why the ” Cash Refunds to credit customers” will be showed on the Debt side of Receivables Ledger Control Account ?2) Why the ” Refunds Received from Customers” will be showed on the Credit side of Payable Ledger Control Account ?
A refund is simply a repayment of cash.
Maybe a customer paid us to much by mistake – therefore we repay/refund the extra.When we receive money from customers we debit cash and credit receivables.
If we give back some of the money (refund) then we credit cash and debit receivables.All of this is explained in my free lectures. The lectures are a complete free course for Paper F3 and cover everything needed to be able to pass the exam well.
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