In: Accounting
Which of the following items is an explicit transaction?
Recognizing expense as equipment is used
Recognizing the revenue for inventory sold
Recognizing expense for prepaid insurance consumption
Accruing for audit fees at the end of the year
Explicit transactions are transactions that involve movement of resources from one party to another. An explicit transaction involves an invoice. In the given case only Recognizing the revenue for inventory sold involves movement of resources.
So, the answer is Recognizing the revenue for inventory sold