Question

3. Which of the following is the account title used to include

instances of price adjustment in case if there is a defective item.
A. Sales returns
B. Purchase discounts
C. Sales returns and allowances

Answer 1

C. Sales returns and allowances.

Step-by-step explanation:

Sales returns and allowances is a deduction from sales that shows the sale price of goods returned by customers, as well as discounts taken by them to retain defective goods.

Answer 2

The correct answer is C. Sales returns and allowances.

Step-by-step explanation:

Sales allowances are discounts that the seller of the product offers to the buyer when there is some type of failure or error in the product or service offered, that is, the buyer pays a lower price because the quality offered is also lower. In this way, there is a double advantage: on the one hand, the buyer obtains the product at a lower price saving money and, on the other hand, the seller discards a defective product without losing money.