Most Entities Satisfy the Accounting Criteria for Recognizing Revenue When

question 5

Multiple Choice

Most entities satisfy the accounting criteria for recognizing revenue when:

• A)an order is received from a customer.
• B)cash is received from a customer.
• C)an unearned revenue account is credited.
• D)a product is delivered or a service is provided.

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Definitions:

Negative Externality

Occurs when a decision by an individual or firm results in unwanted negative effects on another party not involved in the decision.

MSC (Marginal Social Cost)

The total cost to society of producing an additional unit of a good or service, including both private costs and any externalities.

Positive Externality

A benefit received by individuals or society at large from an economic transaction in which they were not directly involved.

Vaccinating

The act of administering a vaccine to help the immune system develop protection from a disease.