Question

in september, sherry's shoe mart ordered women's boots from a supplier. the boots were delivered in october, paid for in november, and sold in december. if sherry uses accrual-based accounting, in which month should she report the boots under cost of goods sold?question 7 options:septemberoctobernovemberdecember

Answer 1

Under accrual-based accounting, Sherry should report the boots under cost of goods sold in December, when the boots were actually sold to customers.

Step-by-step explanation:

If Sherry uses accrual-based accounting, she should report the cost of goods sold when the goods are actually sold, regardless of when they were paid for.

Therefore, Sherry should report the boots under cost of goods sold in December, which is when the boots were sold to her customers.

The accrual method of accounting records revenues and expenses when they are earned or incurred, not necessarily when cash is received or paid.