The accrual basis of accounting applicable to proprietary fund types requires that exchange revenues be recognized when
A) Earned.
B) Collected in cash.
C) Authorized by the budget ordinance.
D) Measurable and available.

Question

Quizplus · Accepted Answer

The accrual basis of accounting requires that revenues be recognized when earned, which means when the exchange transaction has occurred and the goods or services have been provided. Collecting cash, being authorized by the budget, or being measurable and available are not necessarily the determining factors for recognizing revenue on the accrual basis.

The Accrual Basis of Accounting Applicable to Proprietary Fund Types