Most companies recognise sales when:
A) the merchandise is shipped.
B) a customer order is received.
C) the merchandise is received by the customer.
D) cash is received on account.

Question

Quizplus · Accepted Answer

According to generally accepted accounting principles (GAAP), revenue should be recognised when the earnings process is considered complete. For most companies, this occurs when the merchandise is shipped or delivered to the customer. Therefore, Option A is the best choice as it recognizes sales based on shipment.

Most Companies Recognise Sales When