Multiple Choice
Which of the following statements regarding sales returns and allowances is correct?
A) Recording sales returns and allowances in a separate account is an important internal control that allows management to evaluate the volume of returns and allowances as a potential indicator of the quality of their products.
B) The Sales Returns & Allowances account balance should be added to the Sales account balance when computing net sales.
C) The Sales Returns & Allowances account is an example of a contra-asset account.
D) Recording a sales allowance requires two entries.
Correct Answer:
Verified
Correct Answer:
Verified
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