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A furniture company using accrual accounting purchased 30 sofas in November of Year 1 In December of Year 1 10 of the 30 sofas
A furniture company using accrual accounting purchased 30 sofas in November of Year 1 In December of Year 1 10 of the 30 sofas were sold to customers. The customers all signed contracts agreeing to pay half the amount owed in February of Year 2 and the remaining half in March of Year 2. At the time of sale, the company was reasonably sure the customers would pay the amount owed. The furniture company pays its salespeople a commission on each sofa sold, and commissions for December Year 1 sales are paid in January Year 2 In which month should the furniture company recognize the direct expenses associated with the sale of these 10 sofas? March of Year 2 February of Year 2 Januar, of Year 2 December of Year
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