If a company employs the gross method of recording accounts receivable from customers, then sales discounts taken should be reported as ________.
A) sales discounts forfeited on the income statement
B) an item of "other income and expense" on the income statement
C) an increase to sales revenue on the income statement
D) a deduction from sales revenue on the income statement

Question

Quizplus · Accepted Answer

Under the gross method, sales discounts taken by customers are recorded as a deduction from sales revenue on the income statement, reducing the total sales revenue reported.

If a Company Employs the Gross Method of Recording Accounts