Q1. Which of the following is NOT a requirement for revenue recognition to occur?

A)     Cash must have been received.

B)     Earning activities are substantially completed.

C)     Transactions giving rise to revenue should be arms-length.

Q2. Guidance from the U.S. Securities and Exchange Commission regarding the criteria for revenue recognition least likely specifies

    that there must be:

A)   reasonable assurance that the product will be delivered or the service will be rendered.

B)   evidence of an arrangement between the buyer and the seller.

C)   a determined or determinable price.

Q3. Depending on certain circumstance, revenue may be recognized:

A)   Both of these choices are correct.

B)   at the time of sale and when production is complete.

C)   when production is complete and as production occurs.

Q4. As a general rule, revenue is normally recognized when it is:

A)   earned.

B)   realizable and earned.

C)   measurable.

Q5. Under the general principles of accrual accounting, revenue is recognized when:

A)   earned, and expenses are recognized when incurred.

B)   cash is received, and expenses are recognized when cash is paid.

C)   the good or service is delivered or cash is received, whichever is earlier.

答案和详解如下：

Q1. Which of the following is NOT a requirement for revenue recognition to occur?

A)     Cash must have been received.

B)     Earning activities are substantially completed.

C)     Transactions giving rise to revenue should be arms-length.

Correct answer is A)

Revenue from credit sales may be recognized when sales are on account.

Other conditions when revenues are also considered earned include when:  revenue can be measured with reasonable accuracy, transactions are not subject to revocation, it is possible to measure the cost of provided goods (no significant contingent obligation), and there is assurance of payment (cash) or collectability.

Q2. Guidance from the U.S. Securities and Exchange Commission regarding the criteria for revenue recognition least likely specifies

    that there must be:

A)   reasonable assurance that the product will be delivered or the service will be rendered.

B)   evidence of an arrangement between the buyer and the seller.

C)   a determined or determinable price.

Correct answer is A)

One of the SEC’s criteria for revenue recognition is that the product has been delivered or the service has been rendered. The other criteria are evidence of an arrangement between the buyer and seller; the price has been determined or is determinable; and the seller is reasonably assured of collecting money.

Q3. Depending on certain circumstance, revenue may be recognized:

A)   Both of these choices are correct.

B)   at the time of sale and when production is complete.

C)   when production is complete and as production occurs.

Correct answer is A)

Revenue may be recorded as production occurs (% of completion), at completion of production, and at the time of sale.

Q4. As a general rule, revenue is normally recognized when it is:

A)   earned.

B)   realizable and earned.

C)   measurable.

Correct answer is B)

Under the accrual concept, revenue is recognized when the earnings process is completed (earned) and ultimate realization (cash receipt) is assured.

Q5. Under the general principles of accrual accounting, revenue is recognized when:

A)   earned, and expenses are recognized when incurred.

B)   cash is received, and expenses are recognized when cash is paid.

C)   the good or service is delivered or cash is received, whichever is earlier.

Correct answer is A)

The principle of accrual accounting is that revenue is recognized when earned, and expenses are recognized when incurred.

abbaa

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adf

thank you

D