General Rule: Revenue recognized at point of sale (delivery) Exceptions:
- Right of return exists. High percentage of returns common.
Revenue recognized at the time of sale if all 6 criteria met:
- Sales price fixed.
- Buyer obligated to pay seller.
- Buyer bears responsibilities of ownership.
- Buyer exists separately from seller.
- Seller has minimum responsibility to buyer to help sell good.
- Amount of future revenues must be estimated.