Under Which Accounting Method Are Revenues and Expenses Recognized in the Same

question 52

Multiple Choice

Under which accounting method are revenues and expenses recognized in the same accounting period that cash receipts and payments occur?

• A) Under the cash basis of accounting
• B) Under the accrual basis of accounting
• C) Under the percentage of sales method of accounting
• D) Under the direct write-off method of accounting

---

Definitions:

Price Variances

Differences between the actual cost of a product or service and its expected cost, often analyzed in budgeting and cost management.

Quantity Variances

Differences between actual quantities of inputs used in production and the standard quantities expected to be used.

Standards

Established benchmarks or norms for measuring quality, performance, or compliance within an industry or organization.

Variable Factory Overhead Controllable Variance

The difference between the actually incurred variable overhead and what was expected, based on the standard cost.