Asked by Jasmine Simpson on May 19, 2024

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The revenue recognition principle requires that the reporting of revenue be included in the period when cash for the service is received.

Revenue Recognition Principle

An accounting principle that dictates how and when revenue is accounted for and reported, emphasizing that income is recognized when earned, regardless of when cash is received.

Reporting Revenue

Reporting revenue involves the recognition and recording of income generated from the sales of goods or services in the financial statements of a corporation.

  • Identify the fundamentals of revenue recognition and the matching principle as the core concepts of accrual accounting.
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Courtney BlackburnMay 19, 2024
Final Answer :
False
Explanation :
The revenue recognition principle requires that revenue be recognized in the period when the service is provided or the goods are delivered, regardless of when payment is received. Cash receipt may occur before or after the service is provided, but revenue should be recognized when the service is performed, not when cash is received.