Question

Source doc/s when a customer returns faulty inventory:

A. Credit note
B. Sales invoice
C. Purchase order
D. Bank statement

Answer 1

A credit note is issued when a customer returns faulty inventory.

Step-by-step explanation:

The correct answer is:

A. Credit note

When a customer returns faulty inventory, a credit note is typically issued as a form of reimbursement. A credit note is a document issued by a seller to the buyer, indicating the amount that the buyer is allowed to deduct from the amount owed for the returned goods. It serves as a record of the transaction and can be used as evidence for future reference.

For example, if a customer purchases a defective product and returns it to the seller, a credit note may be generated to refund the customer's payment or provide store credit.