Question

In the Month of March, Chester Corporation received orders of 156 units at a price of $15.00 for their product Cozy. Chester uses the accrual method of accounting and offers 30 day credit terms. Chester delivers 104 units in March and the balance of 52 units in April. They received payment for 52 units in March, 52 units in April, and 52 units in May. How much revenue is recognized on the March income statement from this order? How much in the April Income statement? (Answer in thousands)A. $780 , $780B. $1,560 , $780C. $2,340 , 0D.0 , $2,340

Answer 1

option (B) $1,560 , $780

Step-by-step explanation:

Data provided in the question:

Price per unit = $15.00

Number of units delivered in March = 104 units

Number of units delivered in April = 52 units

Now,

The revenue recognized on the March income statement from this order will be

= Number of units delivered in March × Price per unit

= 104 × $15.0

= $1,560

The revenue recognized on the April income statement from this order will be

= Number of units delivered in April × Price per unit

= 52 × $15.0

= $780

Hence,

The answer is option (B) $1,560 , $780