During December, Sandhill Appliance Company sold appliances to Monty Company for $26,920. Sandhill is unable to determine Monty’s ability to pay the amount owing. Monty pays the full amount due in February of the following year. Sandhill uses the earnings approach to revenue recognition. Identify the critical event that will trigger revenue recognition.

Prepare the journal entry to record the shipment of goods to Monty. The goods cost Sandhill $18,380 and Sandhill uses a perpetual inventory system. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation	Debit	Credit
enter an account title to record deferred gross profit	enter a debit amount	enter a credit amount
enter an account title to record deferred gross profit	enter a debit amount	enter a credit amount
enter an account title to record deferred gross profit	enter a debit amount	enter a credit amount
(To record deferred gross profit.)

Answer rating: 100% (QA)

ANSWER The critical event that will trigger the revenue re... View the full answer