The Sales Returns and Allowances Account Is Classified as A(n)

question 25

Multiple Choice

The Sales Returns and Allowances account is classified as a(n)

• A) asset account.
• B) contra asset account.
• C) expense account.
• D) contra revenue account.

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Definitions:

Shareholders' Distribution

The allocation of earnings declared by a corporation to its shareholders, usually in the form of dividends.

Liquidation Account Purpose

The objective of tracking and managing all financial transactions during a company's liquidation process to ensure fair distribution of assets to creditors and shareholders.

Contributories

Individuals or entities that are liable to contribute to the assets of a company in the event of its winding up.

Capital Amount

The total value of all assets of a company or individual, before deductions, including cash and assets that can be used to produce income.