False Value Hardware began 2018 with a credit balance of $32,000 in the allowance for sales returns account. Sales and cash collections from customers during the year were $650,000 and $610,000, respectively. False Value estimates that 6% of all sales will be returned. During 2018, customers returned merchandise for credit of $28,000 to their accounts.
-False Value Hardware's 2018 income statement would report net sales of:

Question

False Value Hardware began 2018 with a credit balance of $32,000 in the allowance for sales returns account. Sales and cash collections from customers during the year were $650,000 and $610,000, respectively. False Value estimates that 6% of all sales will be returned. During 2018, customers returned merchandise for credit of $28,000 to their accounts. 
-False Value Hardware's 2018 income statement would report net sales of:

Quizplus · Accepted Answer

$650,000 - 39,000($650,000 × 6%) = $611,000

False Value Hardware Began 2018 with a Credit Balance of $32,000