GAAP specifies three conditions that must be satisfied in order for revenue to be appropriately recognized.

Question

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GAAP (Generally Accepted Accounting Principles) specifies five main criteria for revenue recognition: identification of the contract, identification of the performance obligations, determination of the transaction price, allocation of the transaction price to the performance obligations, and recognition of revenue when (or as) the entity satisfies a performance obligation.

GAAP Specifies Three Conditions That Must Be Satisfied in Order