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Question - Our Company is in the business of selling pickup trucks that average in price from $10,000 to $20,000. The owner of the company decides to purchase an antique sports car through the company for $200,000 for future sale. How would the antique car be treated at the time of purchase and sale versus the pickup trucks? Should it be different and why?
1. Determine when the seller should recognize revenue.
2. Explain your answer using GAAP revenue recognition guidelines.
3. Explain how each transaction would appear on the income statement and balance sheet for 2019.
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