Netherland Corporation Has the Following Unadjusted Balances: Accounts Receivable, $80,000 $$\begin{array} { | l | r | r | } \hline \text { Accounts Recivable } & 80,000 & \\\hline \text { Sales } & & 80,000 \\\hline\end{array}$$

question 16

Multiple Choice

Netherland Corporation has the following unadjusted balances: Accounts Receivable, $80,000 (debit) , and Allowance for Sales Discounts $300 (credit) . Of the receivables, $50,000 of them are within the 2% discount period, and Netherland expects buyers to take $1,000 in future-period discounts ($50,000 × 2%) arising from this period's sales. The adjusting entry to estimate sales discounts is (are) :

• A) \[\begin{array} { | l | r | r | }
• \hline \text { Accounts Recivable } & 80,000 & \\
• \hline \text { Sales } & & 80,000 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | l | r | r | }
• \hline \text { Sales Discounts } & 700 & \\
• \hline \text { Allowance for Sales Discounts } & & 700 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | l | r | l | }
• \hline \text { Sales Discounts } & 50,000 & \\
• \hline \text { Sales } & & 50,000 \\
• \hline \text { Cost of Goods Sold } & 1,000 & \\
• \hline \text { Inventory Returns Estimated } & & 1,000 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | l | r | r | }
• \hline \text { Sales Discounts } & 1,000 & \\
• \hline \text { Allowance for Sales Discounts } & & 1,000 \\
• \hline
• \end{array}\]
• E) \[\begin{array} { | l | r | r | }
• \hline \text { Sales Discounts } & 1,000 & \\
• \hline \text { Accounts receivable } & & 1,000 \\
• \hline
• \end{array}\]

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Activities directly related to the day-to-day running of a business, including sales, production, and administrative tasks that influence the company's current profitability.

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