Which of the following would normally be considered as a problem associated with the earnings approach to revenue recognition?
A)This approach may be subject to a considerable degree of subjective judgement.
B)The existence of multiple and sometimes conflicting guidelines
C)The difficulties arising from the split of risks and rewards between buyer and seller.
D)All of these

Question

Quizplus · Accepted Answer

All of the given options can be considered as potential problems associated with the earnings approach to revenue recognition. The subjective judgement may lead to inconsistencies in application, conflicting guidelines can make it difficult to determine the appropriate approach, and the split of risks and rewards may complicate the determination of when revenue can be recognized.

Which of the Following Would Normally Be Considered as a Problem