The Side That Increases the Balance of the Sales Discount

question 109

Multiple Choice

The side that increases the balance of the Sales Discount account is:

• A) a credit.
• B) a debit.
• C) zero.
• D) It does not have a normal balance.

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Definitions:

Current Ratio

A financial metric assessing a firm's capacity to cover its short-term debts using assets due within the same period.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of the business.

Current Liabilities

Current liabilities are obligations a company must pay within one year, including accounts payable, short-term loans, and taxes owed.

Note Issuance

The process of creating and distributing a debt security or promissory note, promising to pay back a specified amount of money at a future date.