A company had the following partial list of account balances at year-end: $$\begin{array} { | l | r | }
\hline \text { Sales returns and allowances } & \$ 500 \
\hline \text { Trade receivables } & 9,000 \
\hline \text { Sales discounts } & 700 \
\hline \text { Sales revenues } & 57,200 \
\hline \text { Allowance for doubtful accounts } & 300 \
\hline
\end{array}$$
-What amount of Net Sales would be shown on the income statement?
A) $55,700.
B) $56,000.
C) $57,200.
D) $64,200.

Question

A company had the following partial list of account balances at year-end: $$\begin{array} { | l | r | } 
\hline \text { Sales returns and allowances } & \$ 500 \
\hline \text { Trade receivables } & 9,000 \
\hline \text { Sales discounts } & 700 \
\hline \text { Sales revenues } & 57,200 \
\hline \text { Allowance for doubtful accounts } & 300 \
\hline
\end{array}$$ 
-What amount of Net Sales would be shown on the income statement?
A) $55,700.
B) $56,000.
C) $57,200.
D) $64,200.

Quizplus · Accepted Answer

Net Sales is calculated as Sales Revenues minus Sales Returns and Allowances and Sales Discounts: $57,200 - $500 - $700 = $56,000.

A Company Had the Following Partial List of Account Balances