Under which of the following circumstances would revenue normally be recognised?
A) A customer pays an overdue account.
B) A customer pays for goods in advance of production.
C) The business makes a cash purchase of merchandise.
D) Yhe business makes a cash sale of merchandise.

Question

Quizplus · Accepted Answer

Revenue is recognised when the business makes a sale, which is indicated by the receipt of cash. Therefore, option D - the business makes a cash sale of merchandise - is the only circumstance where revenue would normally be recognised. The other options do not involve a sale and receipt of cash.

Under Which of the Following Circumstances Would Revenue Normally Be