Which of the Following Is True Regarding Revenue Recognition for Sales

question 58

Multiple Choice

Which of the following is true regarding revenue recognition for sales taxes,when reporting in the government-wide statements?

• A) Assets are recognized when the underlying exchange (retail sale) has occurred or when resources are received, whichever occurs first.
• B) Revenues are recognized when the underlying exchange (retail sale) has occurred.
• C) Neither of the above is true.
• D) Both of the above are true.

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Definitions:

Interest Rate

The charge, expressed as a proportion of the principal, required by a lender from a borrower for asset utilization.

Compounded Quarterly

Interest calculation method where interest is added to the principal sum of a deposit or loan every quarter, leading to interest on interest.

Quarterly Payments

Regular payments made every three months, commonly used in dividend distributions or repayment of loans.

Rate of Return

Variation in the worth of an investment over a specific interval, depicted as a percentage of the investment's initial outlay.