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A store accidentally priced an item at $20 instead of $30 and honored the mispricing


A store accidentally priced an item at $20 instead of $30 and honored the mispricing. Where should the store attribute the $10 difference? 

SELECT ONLY ONE 

  • Returns and Allowances 

  • Profit (Loss) 

  • Sales 

  • Operating Expenses 

  • Cost of Goods Sold

business   accounting   
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Answer #1

Solution:

The store should attribute the $10 difference to "Sales".

This is because item is accidentally priced at a lower price. Therefore, the value of sales should be raised to its correct price that is $30. Hence $10 difference will be attributed to "Sales".

Hence, third option is correct.

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