Which of the following statements regarding sales returns and allowances is not true? Group of answer...

Which of the following statements regarding sales returns and allowances is not true?

Group of answer choices

A reduction in the selling price because of damaged merchandise is included in sales returns and allowances.

Sales returns and allowances do not have an impact on gross profit.

Sales returns and allowances are closed to the Income Summary account.

Sales returns and allowances are rarely disclosed in published financial statements.

Sales returns and allowances are recorded in a separate contra-revenue account.

Solutions

Expert Solution

Answer- The following statements regarding sales returns and allowances is not true = Sales returns and allowances do not have an impact on gross profit.

Explanation- Sales returns and allowances are deducted from the sales revenue due to which sales are decreased and also having an impact on gross profit.

ekkarill92 answered 1 year ago

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