Which of the following is not true? Firms recognize revenue
A)when they have completed an earnings process or performed most or all of their obligations to customers, usually the delivery of a product or service.
B)when they have received cash.
C)using the percentage-of-completion method when the firms sell products under long-term contracts, such as construction companies.
D)using the completed contract method [U.S.GAAP, only] when firms cannot reasonably estimate revenues and costs.
E)using a variant of the cost-recovery method [IFRS, only] when firms cannot reasonably estimate revenues and costs.

Question

Quizplus · Accepted Answer

Firms recognize revenue not only when they receive cash but also when they complete an earnings process or perform most or all of their obligations to customers, usually the delivery of a product or service. Choice A, C, D, and E are all true statements about revenue recognition methods.

Which of the Following Is Not True? Firms Recognize Revenue