Brooks Company Sells Merchandise to Customers

Multiple Choice

Brooks Company sells merchandise to customers. Under the accrual basis of accounting, Brooks should normally recognize:

A) revenue and the related expenses in the same accounting period as earned, whether payment is received or not.
B) revenue when cash is collected and expenses when Brooks pays its creditor for the merchandise.
C) revenue and expenses after all payments are made.
D) expenses in the period the merchandise is sold and defer revenue recognition until the customer pays for the merchandise.