On a firm's income statement, net sales consists of ________.
A) operating expenses minus cost of sales
B) total sales minus allowances for returned goods and discounts
C) cost of sales minus allowances for returned goods and discounts
D) cost of sales minus operating expenses
E) total sales minus operating expenses

Question

Quizplus · Accepted Answer

Net sales represents the amount of revenue a firm generates after adjusting for any returns or allowances. Therefore, it is calculated as total sales minus any amounts given back to customers for returned goods and discounts. Option A, C, D, and E do not accurately represent the calculation for net sales.

On a Firm's Income Statement, Net Sales Consists of ________