Question

Canterbury Cycles sells Harleys and pays each salesperson a commission of $800 for each cycle sold....

Canterbury Cycles sells Harleys and pays each salesperson a commission of $800 for each cycle sold. During the month of December, a salesperson sold 3 cycles. The company pays commissions on the 5th day of the month following the sale. Which of the following statements is true?

A. The salesperson will recognize commission revenue earned in the amount of $2,400 in December.

B. The company will recognize commission expense in the amount of $2,400 in December.

C. The company will recognize commission expense in the amount of $2,400 in December.

D. The salesperson will recognize revenue in the same month that the cycle dealer recognizes expense.

Business   Accounting   
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Answer #1

A. The salesperson will recognize commission revenue earned in the amount of $2,400 in December.

B. The company will recognize commission expense in the amount of $2,400 in December.

C. The company will recognize commission expense in the amount of $2,400 in December.

A, B, and C all are right because Sales Person will recognize commission as Revenue and Company will recognize as Commission expense in the Month of December.

and Option B and C are Same hence C is Also right

D. The salesperson will recognize revenue in the same month that the cycle dealer recognizes expense.

Option D. is not Right because there is no information about any dealer in the quetion in between company and Salesperson.

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