ABC Company is holding goods with a selling price of $100,000 which cost them $60,000.On December 3,2017,ABC sold the goods to Timmons under a bill-and-hold arrangement.At the end of 2017,ABC still holds the goods.How much revenue should ABC recognize for 2017?

Question

Quizplus · Accepted Answer

Under a bill-and-hold arrangement, revenue can only be recognized when specific criteria are met, such as the buyer having taken title and assumed the risks and rewards of ownership, and the goods being ready for delivery. If these criteria are not met, as in this case where ABC still holds the goods, no revenue should be recognized.

ABC Company Is Holding Goods with a Selling Price of $100,000