Question

truee/false. it is proper to recognize revenue prior to the sale of merchandise when the revenue will be reported as a sale on a consignment basis. the revenue will be reported under the percentage of completion method.

Answer 1

False. It is not proper to recognize revenue prior to the sale of merchandise on a consignment basis because the revenue will not be realized until the merchandise is sold to the customer. The percentage of completion method is used for long-term contracts, not consignment sales.