During its first year, the company spent approximately $ 3 9 0 , 0 0 0 to
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Question:
During its first year, the company spent approximately $ to catch crocodiles. Of these, crocodiles were sold and shipped to customers at a selling price of $ per crocodile. Shipping costs of $ per crocodile were paid for during the year. Customers were given liberal credit terms and only
$ from an equivalent customers was collected during the first year. Ms Amara estimated that as much as of the sales price will be spent on collection costs and bad debts expenses.
a Prepare three income statements for the year assuming that revenue is to be recognized
when:
Crocodiles have been caught ie production complete
Crocodiles have been sold and delivered
Cash collections are complete
b What income would you report for Why? Support your answer with reference to appropriate FASB's rules.
Related Book For
Cost Accounting A Managerial Emphasis
ISBN: 978-0133392883
6th Canadian edition
Authors: Horngren, Srikant Datar, George Foster, Madhav Rajan, Christ
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