In the case of sales where the customer is billed before delivery of the goods,the seller should always recognize revenue before the products are delivered to the customer. the goods belong to the customer and revenue recognition is deferred until delivery. the seller may recognize revenue if control of the goods has been transferred to the customer even though physical delivery has not taken place. revenue will not be recognized until the goods are shipped to the customer.

First option is wrong because there is no such condition to recognize revenue before delivery of…

Answered: sales where the customer is billed…

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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In the case of sales where the customer is billed before delivery of the goods,

the seller should always recognize revenue before the products are delivered to the customer.
the goods belong to the customer and revenue recognition is deferred until delivery.
the seller may recognize revenue if control of the goods has been transferred to the customer even though physical delivery has not taken place.
revenue will not be recognized until the goods are shipped to the customer.

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