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Revenue recognition - drop ship products

Can revenue be recognized upon sale for resellers of product when delivery of product is directly from the manufacturer to the end user and the reseller lists FOB origin on its invoice? The customers cannot return goods. If they are damaged the reseller will have the manufacturer replace the merchandise.


Topic Expert
Wayne Spivak
Title: President & CFO
LinkedIn Profile
(President & CFO, |

The revenue should be recognized (FOB Origin) the day you/your Manufacturer ships, not the day you process the order.

FOB Destination would be the day the customer receives the merchandise.


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