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| Topic: |
Business
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| Number of pages / Number of words: |
6 / 1597 |
Essay's paper body
Revenue is realizable when assets a company receives in exchange are readily convertible to known amounts of cash or claims to cash. Revenue is earned when a company has substantially accomplished what it much to be entitled to the benefits represented by the revenue.†(Kieso) The revenue must be matched against the expenses that were incurred in order to make the revenue...
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This is known as the realization/earnings/matching approach. (Clark 2006) However, accountants have been unable to define these terms more precisely. The definitions of the terms have not been able to be consistent with the way they are to be used in the various different industries. Because of this reason, Revenue recognition has been viewed as one of the most recurring problems faced by accountants in recent times...
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