Final answer:
Revenues are considered realized, earned, and recognized when there is an exchange of goods or services for cash or claims to cash. This involves an economic transaction that is part of national income and includes various forms of earnings.
Step-by-step explanation:
When goods or services are exchanged for cash or claims to cash (receivables), revenues are realized, earned, and recognized. Realized revenue occurs when goods or services are exchanged for cash or claims to cash. Earned revenue happens when the company has performed a service or delivered a product, and the ownership has transferred to the buyer. Recognized revenue is recorded in the accounting records - it may occur at the time of sale, before, or after, depending on the accounting method used. In an economic perspective, such transactions are akin to trade in the financial capital market, where all forms of economic transactions, including income from foreign investments, are part of the national income which encompasses all earnings such as wages, profits, rent, and profit income.