A Rationale for Recognizing Revenue Over the Life of a Contract

question 150

Multiple Choice

A rationale for recognizing revenue over the life of a contract rather than at a single point in time is that:

• A) Results are more conservative.
• B) It provides a better measure of periodic accomplishment.
• C) It is a better match with legal ownership.
• D) It results in a lower income tax.

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Definitions:

Non-contributory Plan

A benefits arrangement where only the employer bears the cost of premiums, requiring no monetary contribution from employees.

Contributory Plan

A retirement or insurance plan where both the employer and employees contribute to the fund.

Registered Retirement Savings Plans

Tax-advantaged savings accounts in Canada designed to help individuals save for their retirement.

Defined Non-contributory Plan

A type of pension plan where the employer bears the entire cost of the contributions without requiring contributions from the employees.