Asked by Jaime Andres on May 27, 2024
Verified
The sale is itself the sole criterion for recognizing revenue.
Sale
A transaction between two parties where the buyer receives goods, services, or assets in exchange for money.
Revenue Recognition
Refers to the criteria or guidelines used by a company to recognize revenue in its financial statements, ensuring revenue is recorded when earned.
Criterion
A principle or standard by which something may be judged or decided.
- Ascertain the guidelines for acknowledging revenue, including the earned, realized, or potentially realizable aspects, in addition to the pivotal event and quantifiability benchmarks.
Verified Answer
VC
Vrisy CalzadaMay 30, 2024
Final Answer :
False
Explanation :
The sale is not the only criterion for recognizing revenue. To recognize revenue, there are other criteria to be met like delivery, performance, and collectability. The revenue recognition principle states that revenue should be recognized when it is earned and when it can be reliably measured. Therefore, the sale alone cannot be the only criterion for recognizing revenue.
Learning Objectives
- Ascertain the guidelines for acknowledging revenue, including the earned, realized, or potentially realizable aspects, in addition to the pivotal event and quantifiability benchmarks.