When a company ships products to a customer and bills the customer, the company should recognize revenue as earned.

Name: When a company ships products to a customer and bills the customer, the company should recognize revenue as earned.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Revenue recognition principle states that revenue should be recognized when the company has substantially completed its obligations to the customer, which occurs when products are shipped and billed. Therefore, the company should recognize revenue as earned.

When a Company Ships Products to a Customer and Bills