ALL ABOUT ACCOUNTING :- 7th BLOG
A. *****ACCOUNTING***** Hi freinds 🙏., Today's discuss 2nd accounting principles... So let's discuss... 2. REVENUE RECOGNITION :- revenue recognition principle definition.:- The accounting guideline requiring that revenues be shown on the income statement in the period in which they are earned, not in the period when the cash is collected. This is part of the accrual basis of accounting (as opposed to the cash basis of accounting). ★ Criteria for revenue recognition :- Before revenue is recognized, the following criteria must be met: persuasive evidence of an arrangement must exist; delivery must have occurred or services been rendered; the seller's price to the buyer must be fixed or determinable; and collectability should be reasonably assured. ★ Types of revenue recognition :- 1. Sales basis method :- With the sales basis revenue recognition methods, revenue is recorded at the time of sale. Sale is defined as the period of time where goods