Recognition definition
/What is Recognition in Accounting?
Recognition is the recordation of a business transaction in an entity's accounting records . Here are several examples of recognition:
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Recognition of a loss . A loss is recognized on a lower of cost or market analysis, thereby recording the loss in the accounting records.
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Recognition of a sale . A sale transaction is recognized by recording revenue in the accounting records.
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Recognition of an expense . An invoice received from a supplier is recorded as an expense in the accounting records.