Realization Principle in Accounting Steps:

• Define realization: Revenue is recognized when earned, typically upon delivery of goods or services.
• Apply to sales: Earnings process completes when control transfers to customer, not cash or order.
• Assess options: Match each to timing of revenue recognition under accrual basis.
• Select best: Choose statement aligning with transfer of risks and rewards.

Why B is correct:

• Revenue is realized when goods are supplied and ownership passes, as this completes the earning process per the realization principle in accrual accounting.

Why the others are wrong:

• A: Describes cash basis recognition upon bank deposit, ignoring accrual timing.
• C: Order placement creates a commitment but does not realize revenue until delivery.
• D: Not enough information.

Final answer: B