Accounting for IGCSE & O level - Final Statements (Section 9 - No. 17)
What is the impact of purchase returns on the cost of goods sold?
Increase the cost of goods sold.
Decrease the cost of goods sold.
Have no impact on the cost of goods sold.
Increase gross profit.
Explication
Purchase returns reduce the amount of purchases, which in turn decreases the cost of goods sold.