BU127 Chapter Notes - Chapter 7: Internal Control, Money Order, Bank Reconciliation
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BU127 Full Course Notes
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Bu127 chapter 7: reporting, and interpreting sales, revenue, receivables, and cash. It"s probable that economic benefits associated with transaction will flow to the entity: costs incurred or to be incurred in respect of the transaction can be measured reliably. When goods are shipped fob (free on board) shipping point: title changes hands at shipment, and buyer normally pays for shipment. Revenues from goods sold fob shipping are normally recognized at shipment. When they are shipped fob destination point: title changes hands on delivery, and seller normally pays for shipment. Revenues from goods sold fob destination are normally recognized at delivery. The appropriate amount of revenue to record is the cash equivalent sales price. Sales practices differ depending on whether sales are made to businesses or consumers. Companies use a variety of methods to motivate its customers to buy its products and make payment for their purchases (these methods affect the way we compute net sales revenue)
