What is the general rule for recognizing revenues in governmental funds?
A)revenues should be recognized when the budget is adopted
B)revenues should be recognized when available and measurable
C)revenues should be recognized when collected in cash
D)revenues may be recognized either when collected in cash or when the budget is adopted,at the option of the government

Question

Quizplus · Accepted Answer

The general rule for recognizing revenues in governmental funds is that they should be recognized when they are both available and measurable. This means that the revenue must be legally authorized and the amount must be reasonably estimable. The collection of cash is not a requirement for recognition in governmental funds, as accrual accounting principles are used instead. The budget adoption does not determine when a revenue should be recognized, but it may serve as a basis for estimating the revenue. Therefore, the best choice is B.

What Is the General Rule for Recognizing Revenues in Governmental