Question

In the Month of March, Baldwin Corporation received orders of 158 units at a price of $15.00 for their product Bolt. Baldwin uses the accrual method of accounting and offers 30 day credit terms. Baldwin delivers 106 units in March and the balance of 53 units in April. They received payment for 53 units in March, 53 units in April, and 53 units in May. How much revenue is recognized on the March income statement from this order

Answer 1

Answer:

The revenue recognized is "$1,470".

Explanation:

• In March, no sales will be acknowledged because the goods became shipped in April although Baldwin follows the financial reporting accrual process.
• Both sales will be recognized in April because the distribution of the goods was in April. An application being filled or revenue is recognized after all the burden is passed on to the customer and distribution according to Accrual Accounting.

Therefore sales in April was recognized,

= $98\times 15$

= $$1470$