orres Corp. estimates its sales returns at the end of each month. On December 1, 2022, Torres Corp.’s “Sales Return Liability” account had a normal balance of $10,000. During December, the company had customer sales totaling $600,000 and actual returns of $12,000. At the end of December, Torres estimates sales returns related to December’s sales will be $8,000. Question: What should be the “Sales Return Liability” account balance on 12/31/22 after all entries have been made?
orres Corp. estimates its sales returns at the end of each month. On December 1, 2022, Torres Corp.’s “Sales Return Liability” account had a normal balance of $10,000. During December, the company had customer sales totaling $600,000 and actual returns of $12,000. At the end of December, Torres estimates sales returns related to December’s sales will be $8,000. Question: What should be the “Sales Return Liability” account balance on 12/31/22 after all entries have been made?
Chapter7: Budgeting
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Torres Corp. estimates its sales returns at the end of each month. On December 1, 2022, Torres Corp.’s “Sales Return Liability” account had a normal balance of $10,000. During December, the company had customer sales totaling $600,000 and actual returns of $12,000.
At the end of December, Torres estimates sales returns related to December’s sales will be $8,000.
Question: What should be the “Sales Return Liability” account balance on 12/31/22 after all entries have been made?
- $10,000
- $8,000
- $6,000
- $18,000
- $4,000
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