Excel Corporation sells $1,000 worth of goods on July 25 on credit.The customer sends the company a check on August 15.The customer receives the goods on September 1.Assuming the company uses accrual accounting,the sale will be recorded in
A)August.
B)July.
C)September.
D)October.

Question

Quizplus · Accepted Answer

Under accrual accounting, revenues are recognized when earned, regardless of when the payment is received. Since Excel Corporation sold the goods on July 25, the sale is recorded in July.

Excel Corporation Sells $1,000 Worth of Goods on July 25