If a company performs services on account,the revenue is not earned until the cash is collected.

Name: If a company performs services on account,the revenue is not earned until the cash is collected.
Brand: Quizplus
Rating: 5.0 (39 reviews)

Question

Quizplus · Accepted Answer

This statement is false. According to the accrual accounting method, revenue is recognized when earned, regardless of when the cash is collected. Therefore, if a company performs services on account, the revenue is still earned even if the payment is not received yet.

If a Company Performs Services on Account,the Revenue Is Not