7.When goods from a cash sale are returned, the effect on the sellers accounts will be

a decrease in net sales.

an increase in net sales.

a decrease in gross sales.

an increase in gross sales.

8.

Cost of goods sold	$434,000
Income tax expense	67,200
Operating expenses	344,000
Sales	1,100,000
Sales discounts	24,000
Sales returns and allowances	74,000

The profit margin would be

60.6%.

34.3%.

18.5%.

15.6%.

9.Raven Corp. sells merchandise on account for $4,000 to Eagle Corp., terms 2/10, n/30. Eagle returns $1,600 worth of merchandise that was damaged, along with a cheque to settle the account within the discount period. What entry does Raven make upon receipt of the cheque?

Cash	2,320
Sales Returns and Allowances	1,568
Sales Discounts	64
Accounts Receivable		4,000

Cash	2,320
Sales Discounts	80
Sales Returns and Allowances	1,600
Accounts Receivable		4,000

Cash	2,400
Accounts Receivable		2,400

Cash	2,352
Sales Returns and Allowances	1,600
Sales Discounts	48
Accounts Receivable		4,000