Which of the Following Is Not True Regarding the Revenue-Expense

question 19

Multiple Choice

Which of the following is not true regarding the revenue-expense approach to defining accounting elements?

• A)The revenue-expense approach defines assets and liabilities as a by-product of revenues and expenses.
• B)Under the revenue-expense approach, the balance sheet is burdened with by-products of income measurement rules.
• C)Deferred charges and deferred credits are ambiguous debits and credits that appear on the balance sheet under the revenue-expense approach.
• D)There are very few examples of the use of the revenue-expense approach in recent accounting standards.

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Definitions:

Resource

Assets, materials, or valuable items that are available to be used to produce goods or services.

Derived Demand

The demand for a good or service resulting from the demand for another good or service, as seen in the demand for raw materials driven by the production of final goods.

Substitutes

Products or services that can satisfy the same need or desire, where an increase in the price of one leads to an increase in demand for the other.

Complements

Goods and services that are used together, where the consumption of one enhances the use or value of the other.