Question

How do you record abnormal losses?

Answer 1

Abnormal loss is regarded as an expense for the business. Therefore, it should be recorded as an expense and should reflect on the income statement.

Sales return is considered a contra revenue account as it has an opposite effect on the net income. In other words, it reduces the net income.

Also read:

• Cash Book
• Purchase Book
• Sales Book and Sales Return Book
• Cash Flow Statement
• Ledger in Accounting

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