Question

A doctor for the Benson Family Practice performs a sports physical exam for Allison Smythe on February 1. The charge for the exam is​ $100; Smythe's insurance​ company, Cardinal​ Health, is billed for the entire​ $100 on February 1. Cardinal Health receives the invoice on February​ 2, and enters the amount into its payment system on February 4. Benson Family Practice receives the​ $100 payment from Cardinal Health on February 20. On which date would Benson Family Practice recognize the revenue for the​ Smythe's physical?A. February 2B. February 4C. February 20D. February 1

Answer 1

Answer:

D. February 1

Explanation:

Based on the information provided within the question Benson Family Practice would recognize the revenue for the Smythe physical on the day it was billed which is February 1st. This is because according to the recognized revenue principle, revenues should be recognized as soon as they are earned, either by selling a product or service, regardless of when the payment is received.

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