Revenue Is Properly Recognized

question 200

Multiple Choice

Revenue is properly recognized:

• A) When the customer's order is received.
• B) Only if the transaction creates an account receivable.
• C) At the end of the accounting period.
• D) Upon completion of the sale or when services have been performed and the business obtains the right to collect the sales price.
• E) When cash from a sale is received.

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Definitions:

Common-value Auction

An auction format where the item for sale has a value that is essentially the same for all bidders, but the bidders may have different information about that value.

Oral Auctions

Auctions where bids are made verbally, allowing for real-time, competitive bidding among participants.

Reveal Information

The act of making previously unknown or secret information known to others.

Common Value Auctions

Auctions in which the item for sale has a single, unknown value to all bidders, leading to challenges in valuing the item correctly.