There are other acceptable methods of recognizing revenue when the point of sale is not acceptable

There are other acceptable methods of recognizing revenue when the point of sale is not acceptable. List and discuss the other methods reviewed in this chapter, and indicate when they can be used.

Expert Solution

End of production

The realization of revenue at the completion of the production process is acceptable when the price of the item is known and there is a ready market.

Receipt of cash

This method should only be used when the prospects of collection are especially doubtful at the time of sale.

During production

This method is allowed for long-term construction projects because recognizing revenue on long-term construction projects as work progresses tends to give a fairer picture of the results for a given period in comparison with having the entire revenue realized in one period of time.

Junaid answered 8 months ago

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