Question

A company reported the following amounts at the end of the year: total sales revenue = $500,000; sales discounts = $10,000; sales allowances = $15,000; net revenues = $440,000. What amount did the company report for sales returns for the year? $475,000. $25,000. $35,000. $415,000.

Answer 1

Answer:

$35,000

Explanation:

The net revenues of the any company shall be determined through following mentioned formula:

Net revenues=Gross revenues-sales returns-sales discount-sales allowances

Data from the given question shall be used in the above mentioned equation to determine sales returns as follows:

$440,000=$500,000-sales returns-$10,000-$15,000

Sales returns=$35,000

So based on the above calculations, the answer is $35,000

Answer 2

Answer:

The correct answer is $475,000

Explanation:

The question is asking for us to find sales return, which is the net amount recorded on sales of a product, after the expenses incurred during sales have been deducted. To calculate this, we will subtract the total expenses associated with sales from the total sales. This is shown as follows;

Sales revenue = $500,000

Sales discount = $10,000

Sales allowances = $15,000

Sales return = Sales revenue - ( sales discount + sales allowance)

= 500,000 - (10,000 + 15,000) = 500,000 - 15,000 = $475,000

Note that we ignore net revenues because it is not relevant in calculating the sales return, it was in fact calculated using the data from the sales return.