Under the realization principle, revenue should not be recognized until the earnings process is deemed virtually complete and:
A) Revenue is realized.
B) Any receivable is collected.
C) Collection is reasonably certain.
D) Collection is absolutely assured.

Question

Quizplus · Accepted Answer

According to the realization principle, revenue should not be recognized until the earnings process is deemed virtually complete and the collection of receivables is reasonably certain. Collection does not need to be absolutely assured, but only reasonably certain for revenue recognition.

Under the Realization Principle, Revenue Should Not Be Recognized Until