What is revenue recognition?
REVENUE RECOGNITION
Revenue recognition refers to the timing and measurement of revenues. Management applies the revenue recognition criteria of authoritative guidance to decide whether a given transaction meets the criteria and so results in recording revenues (and the related expenses). Revenue recognition is among the most complex issues in financial reporting. Currently, U.S. GAAP contains over 200 pieces of authoritative guidance for recognizing revenues. The quantity and complexity of this guidance result from several factors. First, misreporting of revenues (either reporting revenues before the firm earns them or reporting nonexistent revenues) is the most common form of discovered accounting fraud. Second, firms often bundle products and services and sell them in multiple-element arrangements, and each element of the arrangement has the potential to result in revenue recognition.
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The amount initially paid to acquire an asset is called ______________________________
Fill in the blank(s) with correct word
The following totals for the month of April were taken from the payroll register of Magnum Company. Salaries $10,000 FICA taxes withheld 850 Income taxes withheld 2,000 Medical insurance deductions 450 Unemployment Taxes 420 The entry to record accrual of employer's payroll taxes would include a
A) debit to Payroll Tax Expense for $1,270. B) credit to FICA Taxes Payable for $1,700. C) credit to Payroll Tax Expense for $420. D) debit to Payroll Tax Expense for $2,120.
Which of the following linkages has its human resource management functions built right into the strategy formulation and implementation processes?
A. Integrative linkage B. Administrative linkage C. One-way linkage D. Executive linkage E. Two-way linkage
Prepaid accounts (also called prepaid expenses) are generally:
A. Promises of payments by customers. B. Decreases in equity. C. Assets from prepayments of future expenses. D. Payments made for products and services that never expire. E. Classified as liabilities on the balance sheet.