In accounting, the term "revenue recognition" refers to:
A) Measuring the expense related to the revenue for a specific period.
B) Identifying sources of revenue.
C) Identifying transactions that result in an inflow of cash from customers.
D) Identifying the period when the customer first indicates the need for a good or service.
E) Identifying transactions that should be recorded as revenue in the current reporting period.

Question

Quizplus · Accepted Answer

Revenue recognition refers to the process of identifying transactions that should be recorded as revenue in the current reporting period. This involves determining when the revenue is earned and determining the amount of revenue to be recognized. It is important to recognize revenue accurately in order to present a fair and accurate picture of a company's financial performance.

In Accounting, the Term "Revenue Recognition" Refers To