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store also sells used instruments for people who are willing to give the store part of the sales price.  The sale of used instruments, called sale

store also sells used instruments for people who are willing to give the store part of the sales price.  The sale of used instruments, called sale

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A music store sells new instruments.  The store also sells used instruments for people who are willing to give the store part of the sales price.  The sale of used instruments, called sales commissions, amount to about one-fourth [25%] of total income.  On the firm’s classified income statement under the “Revenue” heading are both New Instrument Sales and Sales Commissions. 

Do you agree with presentation of these in the Income Statement?  Why or why not?

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