When Should a Company Recognize Revenue

question 32

Multiple Choice

When should a company recognize revenue?

• A)When delivery has occurred or services have been provided (rendered).
• B)When the price is fixed or determinable.
• C)When there is persuasive evidence of an arrangement for customer payment and collection is reasonably assured.
• D)All of the above are necessary to recognize revenue.

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Definitions:

Limited Partners

Individuals in a partnership who invest money but are not involved in daily management, and whose liability is limited to the amount of their investment.

General Partners

General partners are individuals in a partnership who are responsible for the operations of the business and are personally liable for the partnership's debts and obligations.

Management

The process or practice of directing and controlling a group or organization towards achieving set goals or objectives.

Joint Venture

An association between two or more parties wherein the parties share profits and management responsibilities with respect to a specific project.