Please help solve Regarding the new revenue recognition standards, which of the following statement is correct?...
Please help solve
Regarding the new revenue recognition standards, which of the following statement is correct?
A.
Under the gross method, Sales Discounts Forfeited is credited when customers do not pay within the discount period.
B.
The gross method should be used only if the seller does not expect to collect from the customer within the discount period
C.
The gross method should be used if the seller expects to collect from the customer within the discount period.
D.
Under the net method, Sales Discounts are debited when customers pay within the discount period.
Homework Answers
If the seller expects that the customer will not take the benefit of discount then the sale should be recorded under gross method.
If the seller expects that the customer will take the benefit of discount then the sale should be recorded under net method.
Option B. is correct
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