Question

The revenue recognition concept
a) Determines when revenue is credited to a revenue account.
b) States that revenue is not recorded until the cash is received.
c) Controls all revenue reporting for the cash basis of accounting.
d) Is in conflict with accrual accounting.

Answer 1

Answer:

a) Determines when revenue is credited to a revenue account

Explanation:

Revenue recognition is a generally accepted accounting principle (GAAP) that identifies the specific conditions in which revenue is recognized and determines how to account for it. Typically, revenue is recognized when a critical event has occurred, and the dollar amount is easily measurable to the company.