On November 20, Routledge Publishing Prints 4,000 Copies of an Accounting

Multiple Choice

On November 20, Routledge Publishing prints 4,000 copies of an accounting textbook. In December, Routledge Publishing ships 1,000 copies to various bookstores, who have the right to return the books if they can't sell them within three months. Historically, the bookstores typically return 4% of the books. Under GAAP, what is the correct accounting for these events?

A) Routledge should record revenues related to 4,000 books in November, when it prints them.
B) Routledge should record revenues in December for 1,000 books, and an allowance for sales returns of 4% of the sales.
C) Routledge should record revenues in December for 1,000 books, and wait until later to record any sales returns.
D) Routledge should wait until after the three-month return period before recording any revenues.