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Questions and Answers
Which principle requires companies to recognize revenue in the accounting period in which the performance obligation is satisfied?
Which principle requires companies to recognize revenue in the accounting period in which the performance obligation is satisfied?
- Revenue Recognition Principle (correct)
- Matching Principle
- Expense Recognition Principle
- Conservatism Principle
When should Dave's Dry Cleaning record revenue for the service performed?
When should Dave's Dry Cleaning record revenue for the service performed?
- In July when it received the cash
- In the first week of July when customers claim and pay for their clothes
- In June when it performed the service (correct)
- In the accounting period when it satisfies the performance obligation
What is the expense recognition principle also known as?
What is the expense recognition principle also known as?
- Revenue Recognition Principle
- Conservatism Principle
- Matching Principle (correct)
- Materiality Principle
According to the expense recognition principle, when should expenses be recognized?
According to the expense recognition principle, when should expenses be recognized?
If a company agrees to perform a service or sell a product to a customer, what does it have?
If a company agrees to perform a service or sell a product to a customer, what does it have?
According to the revenue recognition principle, companies recognize revenue in the accounting period in which the performance ______ is satisfied.
According to the revenue recognition principle, companies recognize revenue in the accounting period in which the performance ______ is satisfied.
Dave’s Dry Cleaning should record revenue in ______ when it performed the service rather than in July when it received the cash.
Dave’s Dry Cleaning should record revenue in ______ when it performed the service rather than in July when it received the cash.
Expense recognition is tied to ______.
Expense recognition is tied to ______.
Accountants follow the rule of letting ______ follow the revenues when recognizing expenses.
Accountants follow the rule of letting ______ follow the revenues when recognizing expenses.
When a company agrees to perform a service or sell a product to a customer, it has a ______ obligation.
When a company agrees to perform a service or sell a product to a customer, it has a ______ obligation.
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