When a Customer Returns for Credit a Defective Product It

question 59

Multiple Choice

When a customer returns for credit a defective product it had purchased,the seller would record the transaction using which of the following accounts?

• A)Purchase Returns and Allowances
• B)Sales Returns and Allowances
• C)Sales
• D)Sales Discounts

---

Definitions:

Direct Costs

Costs that can be directly attributed to the production of a specific good or service, such as raw materials and labor.

Marginal Analysis

Evaluation of the extra benefits derived from an activity versus the extra costs it incurs.

Family Business

A commercial organization in which decision-making is influenced by multiple generations of a family.

Trade Embargo

A government-imposed ban on trade with a specified country or the exchange of specific goods, often used as a political sanction.