Under the Modified Accrual Basis of Accounting, Fines, License Fees

question 26

Multiple Choice

Under the modified accrual basis of accounting, fines, license fees, permits, and other miscellaneous revenue are generally recognized

• A)when cash is received.
• B)when assessed.
• C)when an enforceable legal claim exists.
• D)when an enforceable legal claim exists and the revenue is available.

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Definitions:

Negotiable

Characteristic of a document or instrument that allows its transferability and enforceability by someone other than the original party.

Proceeds

Under Article 9 of the Uniform Commercial Code, whatever is received when collateral is sold or otherwise disposed of.

Honda Civic

A model of compact car manufactured by Honda, known for its efficiency, reliability, and widespread popularity.

Payment Date

The specified date on which a payment, such as a dividend or bond interest, is made by a company to its shareholders or bondholders.