The deposit method postpones recognizing a sale until a determination can be made as to whether a sale has occurred for accounting purposes.

Name: The deposit method postpones recognizing a sale until a determination can be made as to whether a sale has occurred for accounting purposes.
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Question

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The deposit method is used in accounting when there is significant uncertainty about whether a sale has actually occurred or will occur, thus recognition of the sale is postponed until that determination can be made.

The Deposit Method Postpones Recognizing a Sale Until a Determination