Multiple choice

Source document prepared by the vendor showing the amount deducted for returns and allowances

  1. Credit memorandum

  2. Sales discount

  3. Cash discount

  4. debit memorandum
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A Correct answer
Explanation

A credit memorandum is a document issued by a seller to a buyer to notify them that a credit has been applied to their account, typically due to returns or allowances. Other options like sales or cash discounts are related to payment terms rather than the return of goods.

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