QuestionJuly 20, 2025

Multiple Choice Question Revenue associated with the sale of gift cards normally is recognized when the gift cards are redeemed evenly over the life of the gift card. when the gift cards are purchased

Multiple Choice Question Revenue associated with the sale of gift cards normally is recognized when the gift cards are redeemed evenly over the life of the gift card. when the gift cards are purchased
Multiple Choice Question
Revenue associated with the sale of gift cards normally is recognized
when the gift cards are redeemed
evenly over the life of the gift card.
when the gift cards are purchased

Solution
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Answer

when the gift cards are redeemed Explanation 1. Identify Revenue Recognition Principle Revenue is recognized when it is earned and realizable. 2. Apply to Gift Cards For gift cards, revenue is recognized when the service or product is delivered, i.e., when the gift card is redeemed.

Explanation

1. Identify Revenue Recognition Principle<br /> Revenue is recognized when it is earned and realizable.<br /><br />2. Apply to Gift Cards<br /> For gift cards, revenue is recognized when the service or product is delivered, i.e., when the gift card is redeemed.
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