Which statement is correct?

Question

Quizplus · Accepted Answer

Under the net method, an entry is needed if the discount is not taken, while under the gross method, the discount is recorded as revenue initially and then deducted as a contra revenue account if the discount is taken. However, whether the gross or net method is conceptually superior is subjective and based on the specific circumstances of a company's operations. The statement that the gross method overstates revenue is also incorrect, as it accurately reflects the actual amount of revenue earned before any discounts are taken.

Which Statement Is Correct