Which of the Following Is True Regarding Income Recognition

question 124

Multiple Choice

Which of the following is true regarding income recognition?

• A)The seller must have substantially performed its obligations to the customer (for example, by transferring ownership of goods to the customer).
• B)The seller must have obtained an asset from the customer that it can reliably measure.If the asset is not cash, the seller must be reasonably certain of converting it into cash.
• C)The firm recognizes expenses when it consumes assets.
• D)If an event or transaction leads to the recognition of revenue, the firm matches the consumption of any assets (the expense), in time, with the revenue recognized.
• E)all of the above

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Definitions:

Fair Labor Standards Act of 1938

United States federal law that establishes minimum wage, overtime pay eligibility, recordkeeping, and child labor standards.

Child Labor

The employment of children in an industry or business, especially when illegal or considered exploitative.

Unions

Organizations formed by workers to protect their rights and interests through collective bargaining with employers regarding wages, working conditions, and benefits.

Overtime Pay

Additional compensation required by law to be paid to employees who work beyond the standard working hours set by legal, regulatory, or contractual agreements.