Which statement is correct?

Question

Quizplus · Accepted Answer

Under the gross method, an entry is needed if the discount is taken, which ensures accurate recording of both revenue and expenses. The net method, on the other hand, only records the net amount and does not provide a clear picture of the actual revenue and expenses, leading to potential understatement of expenses. The gross method does not overstate revenue as long as the full amount of the sale is not recorded when the discount is taken. Therefore, statement A and C are incorrect, and statement B is potentially misleading.

Which Statement Is Correct