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20 February, 05:59

The question of when revenue should be recognized on the income statement (according to GAAP) is addressed by the:Select one:a. Revenue recognition principle. b. Going-concern principle. c. Objectivity principle. d. Business entity principle. e. Cost principle.

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  1. 20 February, 06:16
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    a. Revenue recognition principle

    Explanation:

    Revenue recognition principle clearly states the circumstances and conditions under which and when the revenue earned shall be recognized in income statement as per accrual basis.

    As a common rule, it is established that when the risk and reward of the product is transferred to the customer, then the revenue shall be recognized, and revenue from monetary transactions like, interest and dividend are based on different rule.

    Therefore, correct option is

    a. Revenue Recognition Principle
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