Using Accrual Accounting, Revenue Is Recorded and Reported Only

question 22

Multiple Choice

Using accrual accounting, revenue is recorded and reported only

• A) when cash is received without regard to when the services are rendered
• B) when the services are rendered without regard to when cash is received
• C) when cash is received at the time services are rendered
• D) if cash is received after the services are rendered

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Definitions:

Quantity Standard

A predetermined benchmark of the amount of input that should be used in the production of goods or services.

Quantity Variance

The difference between the actual quantity of material used in production and the standard quantity expected to be used.

Direct Materials

Raw materials that can be directly associated with the production of a product and are an integral part of the finished product.

Actual Quantity

The real amount of goods or materials used in production, as opposed to the estimated or budgeted amount.