Retail
Store Credit Redeemed on Purchase
Customer uses their store credit balance to pay for a new purchase.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Store Credit Liability | Liability (-) | 116.00 | - |
| Sales Revenue | Revenue (+) | - | 100.00 |
| VAT Output Tax Payable (16%) | Liability (+) | - | 16.00 |
| Cost of Goods Sold | Expense (+) | 55.00 | - |
| Merchandise Inventory | Asset (-) | - | 55.00 |
💡 Accountant's Note
When credit is redeemed, the liability converts to earned revenue and COGS is recognized. No cash changes hands — the transaction is settled entirely through the credit balance.
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