Sales Returns
If a sales return is referenced to a sales order, the cost at which the shipment occurred is used to offset the recognized cost of goods sold.
In the case of a sales return without reference to the original sales order, either the current cost of the item or the price on the RMA order is used to offset the cost of goods sold. This depends on the Unreferenced RMA Receipt Cost option set in the cost profile associated with the item cost profile.
On RMA receipt, Cost Management creates distributions with the accounting line type as RMA Gain/Loss. You can set the same account as that used for the cost of goods sold to ensure that the recognized cost of goods sold is offset on sales return.
For sales return that reference to a sales order, an RMA receipt is costed using the original sales issue cost and, therefore, the cost of goods sold on the forward flow can be completely offset on sales return. However, in the case of an unreferenced RMA, cost of goods sold might not be completely offset on sales return because the original sales issue isn't identifiable.