A college student registers for classes and pays the tuition with a credit card.Because it uses accrual-basis accounting,the college will recognize the payment as revenue as soon as the transaction turns into cash in the school's bank account.

Question

Quizplus · Accepted Answer

Accrual-basis accounting recognizes revenue when it is earned, not when it is received. In this case, the college earns the revenue when the student registers for classes, not when the transaction is turned into cash.

A College Student Registers for Classes and Pays the Tuition