Table of contents

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1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

4. Merchandising Operations

Net Sales

Financial Accounting

4. Merchandising Operations

Net Sales

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Multiple Choice

If the Porter family has total sales of $8,000, sales returns and allowances of $500, and sales discounts of $300, what is their net sales?

$7,500

$7,200

$8,800

$8,000

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Verified step by step guidance

Step 1: Understand the concept of net sales. Net sales is calculated by subtracting sales returns, allowances, and discounts from total sales.

Step 2: Write the formula for net sales: Net Sales = Total Sales - Sales Returns and Allowances - Sales Discounts.

Step 3: Substitute the given values into the formula. Total Sales = $8,000, Sales Returns and Allowances = $500, and Sales Discounts = $300.

Step 4: Perform the subtraction step-by-step. First, subtract Sales Returns and Allowances from Total Sales, then subtract Sales Discounts from the result.

Step 5: The final result will give the net sales value, which represents the actual revenue earned after accounting for returns, allowances, and discounts.