Orange County Shop Follows the Revenue Recognition Principle

question 199

Multiple Choice

Orange County Shop follows the revenue recognition principle. Orange County services a bicycle on July 31. The customer picks up the bike on August 1 and mails the payment to Orange County on August 5. Orange County receives the check in the mail on August 6. When should Orange County show that the revenue was recognized?

• A) July 31
• B) August 1
• C) August 5
• D) August 6

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Definitions:

Splitter Slip-Out

A situation where the splitter gear in a transmission disengages unexpectedly, often leading to a loss of power or control.

Clutch On Upshifts

The action of engaging the clutch during upward gear changes to smooth the transmission of power in a vehicle.

Pre-Selecting

Pre-selecting involves the advance selection or setting of a mode, gear, or option before it is actively needed, allowing a system or device to respond more quickly or fluidly at the moment of activation.

Twisted Mainshaft

A mainshaft that has suffered deformation, often due to excessive torque or a manufacturing defect, leading to misalignment of gears or components.