The Sales Returns and Allowances account is presented
A) on the balance sheet as a deduction from Accounts Receivable.
B) on the income statement as a deduction from Sales.
C) on the income statement as an addition to Sales.
D) on the balance sheet as a deduction from Capital.

Question

Quizplus · Accepted Answer

The Sales Returns and Allowances account is used to track any returned merchandise or customer allowances that reduce the amount of revenue earned from sales. As a result, it is presented on the income statement as a deduction from Sales, which reflects the net amount of revenue earned after returns and allowances are taken into account.

The Sales Returns and Allowances Account Is Presented