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Sagot :
With respect to slowing revenue recognition until completion of a long-term contract, it is the case that: Response: Estimated losses on the general contract are recognized before the agreement is completed.
Which principle is used to identify revenues for long term contracts?
The revenue recognition principle utilizing accrual accounting requires that payments are recognized when realized and earned–not when cash is accepted.
How do you realize revenue in case of service contract?
Income should not be recognised until cash is received by the seller or his agent. Revenue from such sales should not be recognised until interests are offered. However, when experience indicates that most such sales have been consummated, revenue may be recognized when a substantial deposit is accepted.
To learn more about revenue recognition, refer
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