A Company Received an Order from a Customer in June

question 136

Multiple Choice

A company received an order from a customer in June for services to be provided.Those services were provided in July,and the customer paid the full amount in August.According to the revenue recognition principle,in which month should the company record revenue?

• A)June.
• B)July.
• C)August.

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Definitions:

Marginal Revenue Product

The supplementary income derived from the deployment of an extra unit of a production resource, like manpower or assets.

Rent

A regular payment made by a tenant to an owner for the use of the owner's property or land.

Complementary Resource

An asset or input that increases the utility or productivity of another asset or input when used in conjunction.

Marginal Revenue Product

The additional revenue generated by employing one more unit of a factor of production, such as labor or capital.