true
a debit and credit
a debit and credit
a debit and credit
A contra purchase account
Purchase return is a contra account because it reduces the balance in the Purchase account in an attempt to determine cost of goods sold. This is like sales returns and allowances being used to determine net sales on an entity's income statement.
That is correct. Sales and returns allowances is what is called a "Contra" account because it exists to reduce the net balance of an account. Sales is a credit account, so you debit sales returns and allowances in order to reduce your net sales.
No sales returns and allowances has debit balance as a normal balance because these accounts are contra to actual sales account and that's why account balance is reverse of actual sales account.
Sales Returns and Allowances is a contra income account.
A contra account balance is a debit balance account. It is a general ledger account that has a balance that is an exact opposite of a normal balance. Contra accounts are generally used to report the gross and the net amount of an organization.
Drawings account is a contra account because it reduces the owner's equity account's normal balance, a credit balance.
A contra-account is a sub-account or a related account that normally has the opposite balance, thereby reducing the balance of the main account. For example, Reserve for Bad Debts is a contra-account to Accounts Receivable. A/R normally has a debit balance while the reserve normally has a credit balance.
net balance