What Does the Phrase, "Revenue Is Recognized at the Point

question 154

Multiple Choice

What does the phrase, "Revenue is recognized at the point of sale" mean?

• A) Revenue is recorded in the accounting records and reported on the income statement when goods are sold and delivered to a customer.
• B) Revenue is recorded in the accounting records when the goods are received from a supplier, and reported on the income statement when sold to the customer.
• C) Revenue is recorded in the accounting records and reported on the income statement when the cash is received from the customer.
• D) Revenue is recorded in the accounting records when the goods are sold to a customer, and reported on the income statement when the cash payment is received from the customer.

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Definitions:

Financial Disclosure

The process of releasing all relevant financial information about a company to the public, ensuring transparency and aiding in informed decision making.

Internal Controls

Processes designed to ensure the reliability of financial reporting, effective and efficient operations, and compliance with laws and regulations.

Savings and Loan Associations

Financial institutions specializing in accepting savings deposits and making mortgage and other loans.

Governments

Institutions that exercise authority and perform the functions of governing a political state, region, or community through the exercise of legislative, executive, and judicial powers.