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Examveda

The revenue recognition principle dictates that all types of incomes should be recorded or recognized when

A. Cash is received

B. At the end of accounting period

C. When they are earned

D. When interest is paid

Answer: Option C

Solution(By Examveda Team)

The revenue recognition principle dictates that all types of incomes should be recorded or recognized when they are earned. The revenue recognition principle, a combination of accrual accounting and the matching principle, stipulates that revenues are recognized when realized and earned, not necessarily when received.

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