Question
A company follows the accrual basis of accounting and
recognizes revenue when the goods are dispatched, not when cash is received. However, in its final accounts, it also mentions that revenue is recognized only when it is reasonably certain. Which two accounting concepts does this scenario illustrate, and how do they together ensure the reliability of financial information?Solution
The company recognizes revenue upon dispatch, which reflects the Revenue Recognition principle. However, by waiting until revenue is “reasonably certain,” it applies the Prudence (Conservatism) concept, avoiding overstatement of income. These concepts together help ensure that income is neither overstated nor recognized prematurely.
At what Brix reading on a refractometer is sugarcane considered mature?
India lies between ____ latitude and _____longitude.Â
Which among the following is the most crucial role of mulch in dryland agriculture?
Which one of the following is responsible for run-off?
Which soil-forming process involves the removal of silica and concentration of sesquioxides?
Income elasticity of inferior goods is ........................?
Which among the following is a method of identifying leader?
Which physiological disorder in cotton is caused by excessive nitrogen and results in vigorous vegetative growth but poor boll formation?
If the dry matter yield of maize grain is 2000kg and moisture % in grain is 15% then what will be the grain yield?Â
The plant hormone indoleacetic acid is also known asÂ
