alleryStart learning →What does gross sales measure?
AThe sales left after all discounts
BThe sales made only on credit terms
CThe total dollar amount of sales
DThe sales made only for ready cash
Answer & Solution
Correct answer: C. The total dollar amount of sales
1. Revenues are determined starting with gross sales.
2. Gross sales is the total dollar amount of a company's sales, before any deduction.
3. Deducting sales discounts and returns and allowances from gross sales gives net sales, which is the figure left after discounts.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 14 "Using Financial Information and Accounting", section 14.5 The Income Statement_
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