LG sold 800 G7 phones in October for LG Electronics. As the demand was so high,...

LG sold 800 G7 phones in October for LG Electronics. As the demand was so high, LG can just deliver the G7 phones in November and it allowed LG Electronics for paying for them just in December and January. When will LG record the revenue from this sale?

A. October

B. November

C. December

D. December and January

Solutions

Expert Solution

Solution :- In the Given case , LG sold 800 G7 phones in October but As the demand was so high, LG can just deliver the G7 phones in November. LG allowed LG Electronics for paying for them in December and January. In this case , the goods (G 7Phones) are delivered in November while the payment is received in December and January.

In case of sale of Goods, Revenue should be recognised when Risks and rewards have been transferred From the seller to the buyer and when the seller has no control over the goods and the collection of payment is assured. In the Given case , Due to High demand , the goods (G7 Phone ) has been delivered in November , therefore Risks and rewards have been transferred From LG to the LG Electronics at the time of delivery of goods i.e in November and now the seller has no control over the goods while the payment will be received in December and January.

Therefore LG will recognize the revenue in November because Risks and rewards have been transferred From LG to the LG Electronics at the time of delivery of goods i.e in November.

Answer : B November

ekkarill92 answered 1 week ago

Next > < Previous

Related Solutions

Samsung is interested in the elasticity of demand in the smart phones market, so it hired...

Samsung is interested in the elasticity of demand in the smart phones market, so it hired an economist to estimate the demand for smart phones. She found that, in the short run, demand is Qd=100-0.5P, and in the long run, demand is Qd=120-0.6P. In both the long run and the short run, P=$50 a. What is the price elasticity of demand in the short run? b. What is the price elasticity of demand in the long run? c. Given your...

CASE STUDY - LG Electronics From its origins as the progenitor of South Korea’s electronics industry...

CASE STUDY - LG Electronics From its origins as the progenitor of South Korea’s electronics industry and then its first global exporter, LG Electronics has evolved to a respected global brand with manufacturing facilities in China, India, Mexico, Brazil, Poland, and Russia and a presence in 49 countries. Headquartered in Seoul, South Korea, the company has 84,000 employees in 112 locations around the world, including 81 subsidiaries. Perhaps best known today for its quality mobile phones, LG Electronics is also...

The LG Electronics is classified as one of the most sustainable companies in the world. Two...

The LG Electronics is classified as one of the most sustainable companies in the world. Two leading research organizations in the world stated so: The Canadian Corporate Knights Magazine, mentioned in its 2015 annual list of the 100 most sustainable companies in the world; and the Swiss Agency RobecoSAM, in its annual sustainability report of 2015. The Canadian Corporate Knights Magazine lists the sustainability companies according to a set of sustainability criteria in specific industrial sectors, by focusing on the...

An electronics company wants to compare the quality of their cell phones to the cell phones from three competitors.

1. An electronics company wants to compare the quality of their cell phones to the cell phones from three competitors. They sample 10 phones from each company and count the number of defects for each phone. If ANOVA was used to compare the average number of defects, then the treatments would be defined as: Select one: a. The three companies b. The total number of phones c. The number of cell phones sampled d. The average number of defects 2....

LG owns five production plants where 90" high definition televisions are produced. LG can sell up...

LG owns five production plants where 90" high definition televisions are produced. LG can sell up to 25,000 televisions per year at the price of $4000 per television. For each plant, the production capacity, the production cost per television, and the fixed cost of operating a plant for year are given below. Production Plant Cost per Plant Capacity Fixed Cost Television 1 10000 $9 million $1,600 2 8000 $5 million $2,000 3 9000 $3 million $2,300 4 7000 $4 million...

what is the Critical Supply Chain Elements for LG electronics (based on history, trade journals, business...

what is the Critical Supply Chain Elements for LG electronics (based on history, trade journals, business publications and/or current events)

LG Electronics is planning to invest in additional machinery facilities. To determine investment conditions, select two...

LG Electronics is planning to invest in additional machinery facilities. To determine investment conditions, select two accounting subjects for the financial statements you want to look at and explain why.

JB Electronics JB Electronics manufactures three components used to produce cell phones and other communication devices....

JB Electronics JB Electronics manufactures three components used to produce cell phones and other communication devices. In a given production period, demand for the three components may exceed JB's manufacturing capacity. In this case, the company meets demand by purchasing the components from another manufacturer at an increased cost per unit. JB's manufacturing cost per unit and purchasing cost per unit for the three components are as follows: Source Component 1 Component 2 Component 3 Manufacture $ 4.25 $ 4.85...

c. February 7-sold merchandise on account for $800, and the cost of this merchandise sold was...

c. February 7-sold merchandise on account for $800, and the cost of this merchandise sold was $560. Account Name Increase or Decrease Amount Explanation: d. February 10-returned $500 on defective merchandise (list price) of the purchases dated February 3. Account Name Increase or Decrease Amount Explanation: e. February 11-paid the amount due of the purchased realized. Account Name Increase or Decrease Amount Explanation: f. February 12-accepted defective products returned that were sold by $150 on February 7, and the cost...

Company X claims that its cell phones last significantly longer than cell phones sold by company...

Company X claims that its cell phones last significantly longer than cell phones sold by company Y. the company collected the mean length of time that cell phones from each company last before needing to be replaced. xbar s n company a 3.456 .85 80 Company b 2.876 .85 80 Is there sufficient evidence to reject the null hypothesis (that the mean length of time for the two population is equal) at a significance level of .01? a. z-score=4.7657, p-value<.00001;...

Subjects