CT THE BEST ANSWER (SHOWS REFERENCES AND COMPUTATIONS ARE SELE REQUIRED) Which o

Question

CT THE BEST ANSWER (SHOWS REFERENCES AND COMPUTATIONS ARE SELE REQUIRED) Which of the following statement is most true? A) Variable consideration means that the transaction price is uncertain. B) Basing an estimate on the most likely amount is always superior to basing an estimate on the expected value. C) The most likely estimated amount estimated by multiplying the possible amounts with their respective probability of occurrence. D) When the transaction price is uncertain, revenue should not be recognized. 1.

Explanation / Answer

Correct answer is : A) Variable consideration means that the transaction price is uncertain

Variable from it's name depicts it will vary depending upon each case. Variable consideration will change from transaction to transaction, hence it is uncertain and not fixed. Therefore, the statement is correct than the other given situations.

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