The Sales Returns and Allowances Account Is

question 135

Multiple Choice

The sales returns and allowances account is

• A)a contra-asset account.
• B)a contra-revenue account.
• C)on the balance sheet.
• D)on the statement of shareholders' equity.

---

Definitions:

Financial Statement

Reports that summarize the financial performance, position, and cash flows of a business over a specified period.

Permanent/Temporary

Classification of accounts where permanent accounts are balance sheet items that carry over into the next fiscal year, and temporary accounts are income statement items that are closed at year-end.

Copyright Protection

Legal right granted to the creator of original works of authorship, including literary, dramatic, musical, and certain other intellectual works, to control and profit from their use for a certain period.

Normal Balance

The side (debit or credit) of an account that is expected to have a positive balance, determining the increase or decrease of an account.