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Consider the following transactions: A. Borrowed cash on a note payable, $80,000 Dr Cash 80,000 Cr Notes Payable 80,000 B. Provided services on account, $10,000 Dr Accounts Receivable 10,000 Cr Service Fees 10,000 C. Received cash from a customer as payment on account, $8,000 Dr Cash 8,000 Cr Accounts Receivable 8,000 D. Received a utility bill, $1,200 Dr Utilities Expense 1,200 Cr Utilities Payable 1,200 Total assets would be: C. $90,000.


It s beneficial to keep track of sales returns separately from the sales account because that way the business can easily see the dollar amount of sales being returned. If the number is large, that raises the question: "WHY is so much being returned? Is there something wrong with the items we are selling? Are they defective?" If sales returns were just subtracted from the sales revenue account, that possible red-flag information would not be easily seen. One would have to go digging through the Sales general ledger account to find all the returns and add them up. ------- Similarly, it s beneficial to have an easily displayed number for the amount of sales discounts taken. If only a small amount of discounts are being taken by customers, again the question is "WHY aren t customers interested in our discounts? Are our discounts too low? Should we offer a higher discount?" ------- In both cases, separating those items from the Sales Revenue account is primarily an internal management tool, used to see where improvements might be made.

This makes the 3rd question you ve asked within minutes of each other. As with the first 2 questions, we cant help you do the problem unless you are either A) cheating..or B) you cannot tell us where you are stuck and exactly what you dont understand.