Sales Discounts and Sales Returns and Allowances are contra revenue accounts that are credited during the closing process.

Question

Quizplus · Accepted Answer

Sales Discounts and Sales Returns and Allowances are considered contra revenue accounts because they are subtracted from gross sales in order to calculate net sales. As they have the opposite effect on revenue, they are credited during the closing process.

Sales Discounts and Sales Returns and Allowances Are Contra Revenue