BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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It is probable that future economic benefit will flow to the entity and the economic benefit can be measured reliably.
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It is possible that future economic benefit will to the entity and the economic benefit can be measured reliably.
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The entity obtains control of the future economic benefit.
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The future economic benefit can be measured reliably.
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Detailed explanation-1: -Revenue is recognised when it is probable that future economic benefits will flow to the entity and these benefits can be measured reliably. This Standard identifies the circumstances in which these criteria will be met and, therefore, revenue will be recognised.
Detailed explanation-2: -89 An asset is recognised in the balance sheet when it is probable that the future economic benefits will flow to the entity and the asset has a cost or value that can be measured reliably.
Detailed explanation-3: -Income is recognised in the income statement when an increase in future economic benefits related to an increase in an asset or a decrease of a liability has arisen that can be measured reliably.
Detailed explanation-4: -“Assets are probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events.”
Detailed explanation-5: -the amount of revenue can be measured reliably. it is probable that the economic benefits associated with the transaction will flow to the entity. the costs incurred or to be incurred in respect of the transaction can be measured reliably.