Company K purchased certain number of materials for $500,000 on 2022/9/1.

The transaction is made on credit and K will pay the bill on 2022/10/5.
 

On 2022/9/1, Company K purchased a machine for production. The machine costed $720,000 and is expected to last for three years. Company K depreciates the capital expenditure in a straight line on monthly basis
On 2022/9/8, Company K manufactured some products using these materials.
On 2022/9/15, Company K sold half of the products for $300,000 on credit. The costumer will pay the bill on 2022/10/18
 

When are the revenues/expenses recognized and realized?

Answer rating: 100% (QA)

The revenues and expenses are recognized and realized in accordance with the accrual basis of accoun... View the full answer