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Is this under bill and hols arrangement, if it is how to recognized revenue?
Question
On December 15, 20X5, Millwork completed a job for a total price of $24,800. The custom cabinets are to be delivered on December 18 as originally agreed in the contract; however, there is a delay in the construction of the house and the customer is asking Millwork to hold the delivery until January 25, 20X6. Title passes to the customer on December 18.
On December 15, Millwork received payment and recorded revenue for $19,840 on this contract. On December 18, Millwork sent an invoice to the customer and recorded the following journal entry:
DR Accounts receivable 4,960
CR Sales revenue 4,960
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