Common deductions from gross sales, Accounting Basics

Assignment Help:

Q. Common deductions from gross sales?

Generally sales are for cash or on account when a sale is for cash the debit is to Cash and the credit is to Sales. While a sale is on account the debit is to Accounts Receivable and the credit is to Sales.

When companies tender trade discounts the gross selling price gross invoice price at which the sale is recorded is equal to the list price minus any trade discounts.

Two common deductions from gross sales are (a) sales discounts and (b) sales returns and allowances. These subtractions are recorded in contra revenue accounts to the Sales account. The Sales Discounts account as well as the Sales Returns and Allowances account normally has debit balances. Net sales = Sales - (Sales discounts + Sales returns and allowances).


Related Discussions:- Common deductions from gross sales

Explain about the management accounting, Explain about the Management accou...

Explain about the Management accounting Management accounting has also changed by becoming more outward looking in its focus. In past, information provided to managers has bee

Obtain relevant authoritative literature on accounting, Obtain the relevant...

Obtain the relevant authoritative literature on accounting for accounts receivable using the FASB's Codification Research System at the FASB website. What is the specific citation

How to treat entry , Assume we had given tour advance to party how to treat...

Assume we had given tour advance to party how to treat entry and which head have to given expenditure? Ans) Cash/Bank a/c DR To Party(name)a/c (Advance Paid For Tour)

Vouchers, what is the exact meaning of journal that we doing entries??

what is the exact meaning of journal that we doing entries??

Illustrate lcm method, Q. Illustrate lower-of-cost-or-market method? Pr...

Q. Illustrate lower-of-cost-or-market method? Procter & Gamble markets a broad range of paper, cleaning, beauty care, health care, food, laundry and beverage products around th

Show approximation of periodicity, Q. Show Approximation of periodicity? ...

Q. Show Approximation of periodicity? Approximation and judgment because of periodicity To offer periodic financial information accountants must often estimate expected uncolle

Departures from cost basis of inventory measurement, Q. Departures from cos...

Q. Departures from cost basis of inventory measurement? In general companies must use historical cost to value inventories and cost of goods sold. But some circumstances justif

What is net realizable value, Q. What is Net realizable value? Companie...

Q. What is Net realizable value? Companies must not carry goods in inventory at more than their net realizable value. Net realizable value is the approximate selling price of a

calculations indicate about your company, Market determines are useful for...

Market determines are useful for analyzing publicly traded corporations. Many of these calculates use stock price, which reflects the market's (public's) expectation for the compan

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd