Question

AuctionCo.com sells used products collected from different suppliers. Assume a customer ordered a used bicycle through AuctionCo.com for $30. The cost of this bicycle is $20 to AuctionCo.com. The bicycle will be shipped to the customer by the original bicycle owner.
Required:
1. Assume AuctionCo.com takes control of this used bicycle before sale. Under this assumption, how much revenue would the company recognize?
2. Assume AuctionCo.com never takes control of this used bicycle before sale. Under this assumption, how much revenue would the company recognize?
3. Which assumption do you think is more appropriate for the AuctionCo.com case? Explain.



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  • CreatedDecember 23, 2013
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