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A company agrees to give a customer a credit for goods that are deemed unsatisfactory...

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Accounting

A company agrees to give a customer a credit for goods that are deemed unsatisfactory and returned. How is this reported on the company's financial statements?
a. Gross sales are increased by the amount of the credt
b. Gross sales are reduced by the amount of the credit
c. Operating expenses are increased by the amount of the credit
d. Accounts payable are increased by the amount of the credit

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