Under the modified accrual basis of accounting, imposed nonexchange revenues (such as fines) should be recognized
A) when assessed.
B) when the government has an enforceable legal claim.
C) when collected.
D) when the government has an enforceable legal claim and when collected within the current period or soon enough thereafter to be used to pay the liabilities of the current period.

Question

Quizplus · Accepted Answer

Under the modified accrual basis of accounting, imposed nonexchange revenues like fines are recognized when the government has an enforceable legal claim and the resources are available, meaning they are collected within the current period or soon enough thereafter to be used to pay the liabilities of the current period. This approach ensures that revenues are recognized in the period in which they are both measurable and available to finance expenditures of the fiscal period.

Under the Modified Accrual Basis of Accounting, Imposed Nonexchange Revenues