The accounting principle that requires revenue to be recorded when earned is the:
A) Expense recognition (matching) principle.
B) Going-concern assumption.
C) Time period assumption.
D) Accrual reporting principle.
E) Revenue recognition principle.

Question

Quizplus · Accepted Answer

The revenue recognition principle requires that revenue is recorded when earned, regardless of when payment is received. This principle is important for ensuring accurate financial reporting and recognizing revenue in the appropriate period. The other options (A, B, C, and D) all refer to other accounting principles or assumptions that are important for financial reporting, but do not specifically relate to the recognition of revenue.

The Accounting Principle That Requires Revenue to Be Recorded When