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Retailers account for sales of merchandise

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Explain how wholesalers and retailers account for sales of merchandise.

  • Net sales represents sales less deductions for discounts and merchandise returned (returns and allowances) and is a key figure on the income statement.
  • Sales discounts are given to customers who pay their bills promptly.
  • Returns and allowances have the same effect on sales that sales discounts do; that is, they reduce sales.

Reference no: EM13953412

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