cost recovery method Flashcards
1
Q
cost recovery method
A
gross profit on the sale is deferred
no profit is recognized until cumulative receipts including interest revenue exceeds the cost of the asset sold
interest revenue earned by the seller will also be deferred until the entire cost is recovered
2
Q
cost recovery method
A
is used when the uncertainty of collection is so great that even the use of the installment method is precluded
