The Rule for Recognizing Revenues in Generally Accepted Accounting Principles

question 9

Multiple Choice

The rule for recognizing revenues in generally accepted accounting principles is that

• A) Revenues should be recognized when earned, even if the amount that can be realized is not predictable at that time
• B) Revenues should be recognized when cash is received, even if they are not yet earned
• C) Revenues should be recognized when an earnings process is substantially complete, and the revenue is either realized or realizable
• D) Management may choose between recognizing revenues when earned or when cash is received