Sales revenue and the related expense for cost of goods sold

Assignment Help Financial Accounting

Reference no: EM13745258

(Learning Objective 2: Apply the revenue and expense recognition principles) A large auto manufacturer sells large fleets of vehicles to auto rental companies, such as Budget and Hertz. Suppose Budget is negotiating with the auto manufacturer to purchase 827 vehicles. Write a short paragraph to explain to the auto manufacturer when the company should, and should not, record this sales revenue and the related expense for cost of goods sold. Mention the accounting principles that provide the basis for your explanation.

Reference no: EM13745258

Questions Cloud

Customer use to bring suit against the auditors : What theory of liability might a customer use to bring suit against the auditors? What documentation should the auditors prepare regarding their assessment of the risk of material misstatements resulting from fraud?

Provide misleading signals about dropping a current customer : Which of the factors that managers must consider in deciding the allocation of resources across customers might provide misleading signals about dropping a current customer?

Experience with DFDs and system flowcharts : Based on your experience with DFDs and system flowcharts as well as the text material, provide your thoughts on the circumstances under which each type of diagram would be most useful

Determine the amount of manufacturing overhead : Westan Corporation uses a predetermined overhead rate of $22.50 per direct labor-hour. This predetermined rate was based on a cost formula that estimated $270,000 of total manufacturing overhead for an estimated activity level of 12,000 direct labor-..

Sales revenue and the related expense for cost of goods sold : (Learning Objective 2: Apply the revenue and expense recognition principles) A large auto manufacturer sells large fleets of vehicles to auto rental companies, such as Budget and Hertz. Suppose Budget is negotiating with the auto manufacturer to purc..

Key areas for improvement within the pms : Decide on 2-3 critical, key areas for improvement within the PMS - ones that you would target for change in order to improve the system. Name these areas in reference to your assigned textbook and class notes. Discuss in detail why you chose these ar..

Apply the revenue and expense recognition principles : (Learning Objective 2: Apply the revenue and expense recognition principles) Identify the accounting concept or principle that gives the most direction on how to account for each of the following situations: Salary expense of $38,000 is accrued at th..

Hr policy and the implementation of policy vary based : HR Policy and the implementation of policy vary based on organizational norms and adherence and interpretation of the relevant federal and state laws. Throughout the course we have discussed important policy issues and the political, legal, social, e..

The market share Brand K needs to break even : H.M.Alger has just become product manager for Brand K. Brand K is a consumer product with a retail price of $1.00. Retail margins on the product are 23%, while wholesalers have a 10% markup. Variable manufacturing costs for Brand K are $0.10 per unit..

User Account

All Pages