Wadena Ltd. (Wadena) isa retail store that sells tailored-to-measure suits for men and women. Wadena has been in business for 15 years. The process of making a suit takes two to three months.

Customers come for an initial fitting and select the fabric and style they prefer. A minimum of two additional fittings are necessary as the garment is made. The average price for a Wadena suit is $3,000. Customers pay 50 percent of the price of the suit at the initial fitting and the remainder paid when the suit is complete and the customer takes it. One of the reasons for Wadena’s success is its after-sales service. For as long as someone owns a suit, Wadena will repair or make alterations free of charge.

Customers pay by cash or major credit card, although the store will accept cheques from customers it knows.

Required

When should Wadena recognize the revenue for sale of a suit? Explain your answer.