Revenue is generally recognized being earned at the point of time when __________.

Sale is affected

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Cash is received

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Production is completed

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Goods are delivered

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Solution

The correct option is A Sale is affected
Accounting is based on certain basic principles which are commonly known as GAAP. One of them is revenue recognition concept. It defines that revenue is recognized only when there is legal transfer of goods or asset. In fact, it is recognized only when sale is affected.

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