Sales returns and allowances is not a liability rather these are expenses or reduction in actual sales
A sales return or allowance is recorded in a special Sales Returns and Allowances account to maintain a clear distinction between gross sales and reductions due to returns or allowances. This separation allows for more accurate financial reporting and analysis, enabling businesses to track sales performance and customer satisfaction more effectively. Additionally, it helps in reconciling sales figures and provides better insights into sales trends over time.
Uncollectable allowance = 130000 * 2% Uncollectable allowance = 2600
true.
No, return inwards is not a current asset. It is sales returns and comes on the debit side of profit and loss account. otherwise, lessened from the sales on credit side
Sales returns day book only record the sales returns in any day and no other entry is recorded in it.
Sales returns and allowances is not a liability rather these are expenses or reduction in actual sales
If sales commission is payable in future time then it is current liability but if it is paid already then it is expense.
On the trial balance, Sales Returns and Allowances is a liability. If items returned are sold later, they become assets under sales.
A sales return or allowance is recorded in a special Sales Returns and Allowances account to maintain a clear distinction between gross sales and reductions due to returns or allowances. This separation allows for more accurate financial reporting and analysis, enabling businesses to track sales performance and customer satisfaction more effectively. Additionally, it helps in reconciling sales figures and provides better insights into sales trends over time.
Uncollectable allowance = 130000 * 2% Uncollectable allowance = 2600
To provide more information. "Netting out" items such as gross sales against returns and discounts hides information that may be desirable. For example, if no allowance for returns is being recorded, then the so called net sales figure is probably overstated, but this can not be determined if sales are presented at net.
true.
Sales commission payable is not part of income statement and it is shown in balance sheet as current liability in liability side of balance sheet.
Sales tax payable is a current liability and is presented on the credit side of the balance sheet-
No, return inwards is not a current asset. It is sales returns and comes on the debit side of profit and loss account. otherwise, lessened from the sales on credit side
no
no