A Financial Asset That Represents a Claim on Another Financial

question 55

Multiple Choice

A financial asset that represents a claim on another financial asset is classified as a(n) ________ asset.

• A)secondary
• B)optioned
• C)contracted
• D)derivative
• E)primary

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Definitions:

Revenue Recognition

The accounting principle that dictates the specific conditions under which income becomes recognized as revenue.

Revenue Recognition Principle

An accounting principle that dictates the conditions under which revenue is recognized and recorded.

Performance Obligations

Promises in a contract to transfer goods or services to a customer, central to revenue recognition principles.

Transaction Price

The total monetary value exchanged or agreed upon in a transaction.