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Revenue Recognition Principle in More Detail

14 August, 2015 - 17:32

GAAP provide guidance about when financial transactions should be recognized in financial statements. At this point in our studies, a financial transaction is recognized when it meets two criteria:

  1. It is probable that any future economic benefit (usually cash) associated with the transaction will be received or paid at some time in the future; and
  2. The value of the transaction can be reliably measured.