The basic concept for revenue recognition is the realization of cash.

Question

Quizplus · Accepted Answer

The basic concept for revenue recognition is not just the realization of cash, but rather the recognition of revenue when it is earned, regardless of whether cash has been received or not. This is in accordance with the accrual accounting method, which recognizes revenue when it is earned and expenses when they are incurred, regardless of when the cash is received or paid.

The Basic Concept for Revenue Recognition Is the Realization of Cash