Test Review

Topics for review for Exam 3 Chapter 10 GAAP rules for gross recognition- 1)Persuasive try of an arrangement exists, 2)Delivery has occurred or services have been rendered, 3)The traffickers price to the buyer is fixed or determinable 4)Collectibility is fairly assured. Fraud risks related to revenue recognition ( eminence and take sales, transport stuffing, lapping, etc.) 1)Side agreements- arrangements used to alter terms & conditions of recoreded sales in order to entice cust. to accept delivery of goods & services 2)Channel Stuffing- (or skirmish loading) mrkt practice some suppliers use to boost sales by inducing distrib. To buy substantial more inventory than they lavabo promptly resell. 3)Related-party proceeding- difficult to identify. Pose substance over good-natured issues. 4)Bill and Hold gross revenue- sales where cust. agrees to buy goods but seller retains physical possession until cust. requests shipment. Such arrangement does not imm obilise as a sale bevause delivery has not occurred. Types of legal proceeding and affected accounts in revenue process Sales ( AR, unearned cash, interlingual rendition of service for cash or character) Receipt of Cash- from cust.

in pay for goods or service Returns Revenue documents (sales order, credit approval, open-order give notice (of), bill of lading, invoice, statement, etc.) oOrder- degree of type & qty of prod. or service. ordered oCredit Approval- procedure for break down creditworthiness of cust. result documented on credit approval form. oOpen-Order Report- report of all cust orders in which processing has not been completed o*B! ill of Lading- (Shipping Document)- contains info on qty , type of prod. shipped oSales Invoice- bill customers oStatements- normally mailed periodic. Sales, cash receipt, credit memo. oA/R aged- weekly/monthly synopsis of cust balances. 30 days (31-60, 90 days) oCash expediency Journal- debit cash, credit a/r, credit other accts as grain sale or int. income oCredit...If you want to soak up a full essay, order it on our website: OrderCustomPaper.com

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