Slim Co.is ordering a new computer for its corporate office.Which of the following events would trigger the recognition of the computer and related liability on Slim's books?
A)The company generates a purchase order.
B)The purchasing department sends a purchase order to the supplier.
C)The company receives the computer.
D)The company receives the bill from the supplier.

Question

Quizplus · Accepted Answer

Recognition of an asset and related liability occurs when the company gains control of the asset, which typically happens upon receipt of the goods, in this case, the computer.

Slim CoIs Ordering a New Computer for Its Corporate Office