Thompson Company executives are planning a $5 million advertising campaign. The expense of this advertising campaign should be recognized when:

Question

Quizplus · Accepted Answer

The expense of the advertising campaign should be recognized when the commercials are broadcast because at this point, the advertising expense has been incurred and the company has received the benefit of the advertising. Until the commercials are actually broadcast, it is uncertain whether the advertising campaign will actually happen or not, and the expense should not be recognized until it is certain.

Thompson Company Executives Are Planning a $5 Million Advertising Campaign