Q. 3-5RQ - Horngren'S Financial And Managerial Accounting

Question

Under the revenue recognition principle, when is revenue recorded?

Step-by-Step Solution

Answer

Revenue is recognized goods or services are provided to the customers. 

Accounting Principles

Accounting principles are the set of rules or guidelines, that are followed while preparing the financial statements. 

Explanation on Revenue Recognition Principle

Revenue recognition principle provides the general rule to record or recognize the revenues of the business. As per this principle, revenues are recorded when the related obligation to revenue is performed.