1083. Revenue Recognition Concept
According to the revenue recognition concept, in order to recognize revenue from a transaction, there are two things which should have occured, namely : -• Transaction should have been entered into;• Right to receive the payment must be established.The revenue recognition event need not necessarily occur with the event of collection of cash. Once the above two factors are established, even if the cash is received at a later point in time, it does not make any difference to the recognition of revenue. The undermentioned video explains the concept of revenue recognition in detail.