Revenues Are Normally Considered to Have Been Earned When

question 33

Multiple Choice

Revenues are normally considered to have been earned when:

• A)all possibility of return has expired.
• B)the company has substantially accomplished what it must to be entitled to the benefits.
• C)the cash is collected.
• D)goods have been shipped.

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Definitions:

Substitution Effect

The alteration in purchasing habits stemming from a shift in the relative cost of products, causing individuals to replace one item with another.

Price Change

A variation in the cost of a good or service over time or in response to supply and demand dynamics.

Income

The money received by an individual or entity in exchange for labor, from investments, or from any other source, over a period of time.

Utility Function

A mathematical representation that ranks an individual's or agent's preferences over sets of goods and services, yielding levels of satisfaction.