When the Net Price Method Is Used to Record Credit

question 121

Multiple Choice

When the net price method is used to record credit sales, the sales discounts not taken account is reported as an)

• A) addition to sales returns and allowances on the income statement.
• B) deduction from gross sales on the income statement.
• C) deduction from selling expenses on the income statement.
• D) addition to sales revenue on the income statement.

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Definitions:

Damages

Monetary compensation awarded to a party in a legal proceeding for loss or injury.

Prove

To demonstrate the truth or existence of something through evidence or argument.

Undue Influence

Improper or unlawful pressure exerted on a person, compelling them to act against their will or to give up a legal right.

Dependent Party

An individual or entity that relies on another for support, often used in legal contexts to determine responsibilities or benefits.