When Journalizing for the Estimated Sales Returns,there Would Be a Debit

question 108

Multiple Choice

When journalizing for the estimated sales returns,there would be a debit to:

• A)Sales Refunds Payable.
• B)Cost of Goods Sold.
• C)Sales Returns and Allowances.
• D)Accounts Receivable.

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Definitions:

Revenue Recognized

The point at which revenue is considered earned and can be recorded in the financial statements, according to specific criteria.

Expenses Incurred

The costs that have been consumed or used up in the operation of a business, contributing to the generation of revenue.

Adjusting Entries

The process of making entries in the ledger at the end of the accounting period to allocate profits and expenses to their actual period.

Costs Expire

When a cost is recognized as an expense, typically through depreciation for fixed assets or cost of goods sold for inventory, indicating it has been fully utilized in generating revenue.