Q35390428

Matching Concept: Expenses & Revenues How does sales salaries expense directly relate to revenue? Please explain.

TB 03-112 The expense recognition principle requires: The expense recognition principle requires: Multiple Choice that expenses should be split between Cost of Goods Sold (sometimes called Cost of Sales) and Selling Expenses. that current assets and current liabilities are stated in a certain order on the balance sheet. that costs are recognized as expenses in the same period as the revenues they generate. that expenses should be recognized on periodic basis.

The principle that states revenue should be recognized when earned, regardless of when cash is received, is called the: a) Cash basis principle b) Revenue recognition principle c) Matching principle d) Accrual basis principle

41. Realization of revenue occurs when a. the item is formally recorded and reported in the financial statements b. noncash resources are converted into cash or rights to cash c. the actual exchange of noncash resources into cash С. d. when a transaction is both realized and realizable 42.A revenue recognition method that recognizes revenue before the time of sale is a. percentage-of-completion b. installment c. cost recovery d. point of sale С.

Income reported for a business entity depends on the proper recognition of revenues and expenses. In certain cases, costs are recognised as expenses at the time of product sale and in other situations costs are capitalised if they bring future benefits.In around 250 words, comment on the above statement. Your comments should include valid examples and illustrations.

Why are payments received from customers in advance, for either services to be performed and/or for goods to be delivered, classified as liabilities upon the receipt of the funds?

Revenues and expenses must be recorded in the accounting period in which they were earned or incurred, no matter when cash receipts or outlays occur under which of the following accounting methods? revenue basis accounting B accrual basis accounting cash basis accounting tax basis accounting cr

Porite Company recognizes revenue in the period in which it records an asset for the related account receivable, rather than in the period in which the account receivable is collected in cash. Porite's practice is an example of: Multiple Choice O Economic entity. The matching principle. Accrual accounting. Cash basis accounting.

The expense matching principle states that:   Multiple Choice   Expenses are recognized when paid.   All expenses are recognized when the corresponding revenue is recorded.   Some expenses are recognized when the corresponding revenue is recognized and some are spread over time.   Expenses are recognized when the invoice is received.