In December 2013 Salmo Ltd. (Salmo) received a large order from Richelieu Inc. (Richelieu), an established customer. The customer asked that the product be delivered in the second week of January 2014. During the last week of December Salmo’s controller realized the company wouldn’t meet its earnings target and as a result the company’s senior managers would miss out on significant year-end bonuses. In an effort to meet the target the controller instructed the shipping department to ship Richelieu’s order on December 30, rather than waiting until January 9, 2014, which would have met the customer’s instructions. The controller figured the customer wouldn’t mind receiving the product a few days early, even though the change in delivery date wasn’t discussed with the customer. Because Salmo uses independent shipping companies to deliver its merchandise, it normally recognizes revenue when the goods are shipped.

Required:

When should Salmo recognize the revenue on the sale to Richelieu? Explain your answer.