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Selling goods has occurred for revenue-recognition purposes when:
ACustomer expresses interest
BCash received OR legal right to receive cash has been created
CSales order is recorded internally
DGoods reach the dispatch bay
Answer & Solution
Correct answer: B. Cash received OR legal right to receive cash has been created
1. Per OCR: "revenue is said to have been realised when cash has been received or right to receive cash on the sale of goods or services or both has been created."
2. Realisation = trigger for revenue.
3. Mere order placement is not realisation.
_Source: ICMAI BoS CMA Foundation Paper 2 (FFCA) — Paper2_07042026.pdf, Module 1 §1.2.2.1 (page 18)_
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