Revenue from a Contract with a Customer

question 49

Multiple Choice

Revenue from a contract with a customer

• A) is recognized even if the contract is wholly unperformed.
• B) is recognized when the customer exercises its right to provide consideration.
• C) cannot be recognized even if the performance obligation has been satisfied.
• D) cannot be recognized until a contract exists.

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Definitions:

Accounting Period

A specific time frame covered by financial statements, typically a fiscal quarter or year, used for calculating earnings and managing taxation.

External Auditor

An independent third party hired to examine the financial statements of an entity to ensure accuracy and adherence to accounting standards.

Internal Control System

A set of procedures and mechanisms implemented by a business to ensure the integrity of financial and accounting information, promote accountability, and prevent fraud.

Cost-Benefit

An analysis or assessment comparing the costs and benefits of a decision or project to determine its feasibility or worthiness.