When Does a Company Account for Earned Revenue If It

question 4

Multiple Choice

When does a company account for earned revenue if it follows cash basis accounting?

• A)When services are rendered, even though cash may be received at a later date
• B)When cash is received after the service is completely rendered
• C)When the services are being rendered
• D)When cash is received, either prior to the services being rendered or at a time after the services are rendered

---

Definitions:

Undervalued

A term referring to an asset or a company that is available for purchase at a price perceived to be below its inherent value.

Stockholders' Equity

The remaining interest in a corporation's assets after all liabilities have been subtracted, indicating an ownership stake.

Amortization

Amortization is the process of gradually reducing the cost of an intangible asset over its useful life, or systematically repaying a debt over a period of time.

Intra-Entity Bonds

Intra-entity bonds refer to bonds issued between entities within the same corporate group, used for internal financing purposes.