Asked by Carley Lambeth on Apr 27, 2024
Verified
Sales Discounts is added to the Sales account when computing a company's net sales.
Sales Discounts
Sales discounts are reductions in price offered to customers as an incentive for early payment or to encourage sales.
Net Sales
The total sales income of a company after removing costs associated with returns, allowances for damaged or lost items, and price reductions.
- Comprehend the effects of sales discounts and returns on the financial reports of a company.
Verified Answer
AR
ashley reevesApr 28, 2024
Final Answer :
False
Explanation :
Sales Discounts is subtracted from the Sales account when computing net sales because it represents reductions in revenue due to discounts offered to customers.
Learning Objectives
- Comprehend the effects of sales discounts and returns on the financial reports of a company.
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