All of the Following Statements Regarding Sales Returns and Allowances

question 166

Multiple Choice

All of the following statements regarding sales returns and allowances are true except:

• A)New revenue recognition rules require sellers to report sales net of expected returns and allowances for annual periods.
• B)The Inventory Returns Estimated account is a current liability account.
• C)Sales returns and allowances estimates are typically made as period-end adjustments.
• D)When sales returns and allowances adjustments are made to sales,an estimate must also be made for the cost side.
• E)Sales Refund Payable is a current liability account.

---

Definitions:

Financial Maneuvers

Strategies or operations undertaken by individuals or companies to optimize financial outcomes.

Capital Investments

Expenditures by a company on physical assets like property, industrial buildings, or equipment to improve its operations and productivity.

Labor Law Reform

Changes proposed or enacted in legislation to address issues in labor markets, including working conditions, employee rights, and union activities.

NLRA

The National Labor Relations Act, a foundational US law that guarantees workers the right to organize, bargain collectively, and participate in strikes and other union activities.