Under Accrual Accounting When Is Revenue Recognized

question 90

Multiple Choice

Under accrual accounting when is revenue recognized?

• A)When cash is received, and expenses when cash is paid
• B)When cash is received, and expenses when the costs are incurred.
• C)When earned, and expenses when incurred.
• D)When earned, and expenses when cash is paid.

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Definitions:

Functional Currency

The currency of the primary economic environment in which an entity operates and carries out its business activities.

Exchange Rates

The ratio at which one currency may be swapped for another, affecting global commerce and economic activities.

Investment in Martin

A specific financial investment made in a company or entity named Martin, denoting ownership or interest.

Net Income

The amount of profit remaining after all operating expenses, taxes, and interest payments are deducted from total revenue.