Revenue is recognized at the earliest moment that the critical event and measurability criteria are both satisfied.

Question

Quizplus · Accepted Answer

This statement is a correct interpretation of the principles of revenue recognition as outlined by generally accepted accounting principles (GAAP). The critical event refers to the point at which goods or services have been provided to the customer, while measurability means that the amount of revenue can be reliably measured. Once both criteria are met, revenue can be recognized in the financial statements.

Revenue Is Recognized at the Earliest Moment That the Critical