Main Revenue Recognition Principle

Posted by Ana Orwel on Tuesday, April 21, 2009

What is the main revenue recognition principle? There might be several recognition principles, which can be applied in revenue accounting, i.e. sales basis, cash basis and installment method.

The main revenue recongnition principle is Sales basis or we can call it “Point of sale” method, where revenue is recognised at the moment when sale has occured, without taking into account actual time the payment for such sales was received.

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