In a consignment arrangement, revenue typically should not be recognized until sale to a third party occurs, even though there has been a physical transfer of goods to the consignee, because the consignor still retains legal title to the goods.

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In a consignment arrangement, the consignor retains legal title to the goods until they are sold to a third party. Therefore, revenue should not be recognized until the sale to a third party occurs, even though the physical transfer of goods has taken place to the consignee.

In a Consignment Arrangement, Revenue Typically Should Not Be Recognized