Accountıng I Deneme Sınavı Sorusu #1313691
Which of the following is the definition of "revenue"?
Revenue is recognition of the sales before the payment is done. |
Revenue is the dictation that revenue is recognized when it is in cash. |
Revenue is the gross decrease in owner’s equity that results from operations. |
Revenue is the cost of assets consumed or services used during the revenue earning process. |
Revenue is the gross increase in owner’s equity from delivering goods or services to customers and clients. |
It is important to know when companies should recognize revenue, in other words, when the companies earned the revenue. Revenue recognition principle will guide us. But first of all we will start with the definition of revenue and expense terms. Revenue is the gross inflow of economic benefits during the period arising from the course of the ordinary activities of an entity when those inflows result in increases in equity, other than increases relating to contributions from equity participants. Expense is outflows or other using up of assets or incurrences of liabilities during a period from delivering or producing goods, rendering services, or carrying out other activities that constitute the entity’s ongoing major or central operations.
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