Which of the following describes Sales Returns and Allowances?
A) A revenue account with a normal credit balance.
B) An expense account with a normal debit balance.
C) A contra revenue account with a normal debit balance.
D) A contra expense account with a normal credit balance.

Question

Quizplus · Accepted Answer

Sales Returns and Allowances is a contra revenue account, as it reduces the amount of revenue earned from sales. It has a normal debit balance because it is reducing the credit balance in the sales revenue account.

Which of the Following Describes Sales Returns and Allowances