What criterion or criteria must sales transactions meet in order for the seller to recognize revenues before collecting cash?
A)The revenues must be earned (the firm must have achieved substantial performance).
B)The amount to be received must qualify as an asset (there must be a future economic benefit and the amount must be measured with sufficient reliability).
C)The firm must have a reasonable expectation that it will collect the amount owed from the customer.
D)All of the above.
E)None of the above.

Question

Quizplus · Accepted Answer

All of the criteria mentioned in options A, B, and C must be met before a seller can recognize revenues before collecting cash. The revenues must be earned, the amount to be received must qualify as an asset with a future economic benefit that can be measured with reliability, and the seller must have a reasonable expectation of collecting the amount owed from the customer.

What Criterion or Criteria Must Sales Transactions Meet in Order