Although revenue may be recognised at various points in the revenue generation sequence, it is normally recognised when:
A) customers forward a firm order.
B) the product is delivered to customer.
C) the customer pays for the goods.
D) the warranty period expires.

Question

Quizplus · Accepted Answer

Revenue is typically recognized when the product or service is delivered to the customer. Option A may indicate intent to purchase, but until the product or service is delivered, revenue should not be recognized. Option C may indicate payment, but if the product or service has not yet been delivered, it would not be appropriate to recognize revenue. Option D is not a relevant point in the revenue recognition sequence.

Although Revenue May Be Recognised at Various Points in the Revenue