A Local Ice Cream Shop Pledged 10% of Its Sales

question 28

Multiple Choice

A local ice cream shop pledged 10% of its sales on July 1 to the Children's Clubhouse, a not-for-profit organization. How should the Children's Clubhouse treat this pledge?

• A)Accrue the pledge when it is made
• B)Accrue the pledge only if the amount can be reasonably estimated
• C)Accrue the pledge only if there is reasonable assurance that the ice cream shop will pay
• D)Recognize the pledge when it is collected

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Definitions:

Retailing

All activities involved in selling, renting, and providing products and services to ultimate consumers for personal, family, or household use.

Marketing Activity

Any action or task carried out by a company to promote and sell its products or services, including advertising, promotions, and public relations.

Customer Value

Customer value refers to the perception of benefits derived from a product or service in relation to its cost, influencing buying behavior and customer loyalty.

Albertsons Grocery Store

A popular American grocery company offering a wide range of food and household items across its numerous locations.