GK
ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Revenue is generally recognised as being earned at that point of time when
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production is completed
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debts are collected
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cash is received
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sale is effected
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Explanation:
Detailed explanation-1: -Revenue should not be recognised until cash is received by the seller or his agent. Revenue from such sales should not be recognised until goods are delivered. However, when experience indicates that most such sales have been consummated, revenue may be recognised when a significant deposit is received.
Detailed explanation-2: -Revenue is the total amount of income generated by the sale of goods or services related to the company’s primary operations. Revenue, also known as gross sales, is often referred to as the “top line” because it sits at the top of the income statement. Income, or net income, is a company’s total earnings or profit.
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