All of the Following Statements Regarding Sales Returns and Allowances

question 100

Multiple Choice

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

• A)Sales returns and allowances can include a reduction is the selling price because of damaged merchandise.
• B)Sales returns and allowances do not reflect the possibility of lost future sales.
• C)Sales returns and allowances are recorded in a separate contra-revenue account.
• D)Sales returns and allowances are rarely disclosed in published financial statements.
• E)Sales returns and allowances are closed to the Income Summary account.

---

Definitions:

Office Support System

Integrated software solutions designed to facilitate and automate the day-to-day operations and tasks of an office.

Management Information System

An information system designed to meet the management and decision-making needs of an organization, integrating data from various departments for analysis.

Intelligence

The ability to acquire and apply knowledge and skills.

Data Warehouse

A centralized repository for data that allows an organization to store, query, and analyze large amounts of structured data from various sources.