B is corrent. Total revenues recognized on an income statement are calculated as sales less sales returns and allowances, sales discounts, and estimated allowance for returns. The purchase discounts account is a contra account to purchases, and is not used in the calculation of net sales. Recovery of accounts written off requires an entry to reinstate the account receivable, and a second entry to record the payment. It does not affect total revenues. Therefore, total revenue is equal to the sales amount of $250,000.
A is incorrect because it increases Sales by Purchase discounts ($250,000 + $3,000 = $253,000). Purchase discounts is a contra purchases account and is not used in the calculation of net sales.
C is incorrect because it increases Sales by Recovery of accounts written off ($250,000 + $10,000 = $260,000). Recovery of accounts written off results in a net adjustment to the allowance account and cash and is not used in the calculation of net sales.
D is incorrect because it increases Sales by Purchase Discounts and Recovery of accounts written off ($250,000 + $3,000 + $10,000 = $263,000). Purchase discounts is a purchases contra account and recovery of accounts written off results in a net allowance and cash adjustment. Neither enter into the calculation of net sales.
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