If the amount of sales returns and allowances is small in proportion to gross sales, a weakness in the merchandising operations is indicated and the trouble should be determined and corrected.

Question

Quizplus · Accepted Answer

This statement is incorrect. If the amount of sales returns and allowances is small in proportion to gross sales, it actually indicates strength in the merchandising operations, as it shows that there are fewer customer complaints and product returns.

If the Amount of Sales Returns and Allowances Is Small