Persuasive evidence of an arrangement does not exist when:

Detailed Explanation:

Rationale for Correct Answer: According to SAB 104 , revenue recognition requires persuasive evidence of an arrangement. This does not exist if there is no written contract, purchase order, or verbal agreement supporting the transaction.

Analysis of Incorrect Options:

A. Revenue and expenses don’t match – Violates matching principle, not persuasive evidence.

C. Timings not meet properly – Refers to delivery/performance, not evidence of arrangement.

D. Capitalized expenses and liabilities – Irrelevant to revenue recognition.

Key Concept: Revenue recognition requirement: Persuasive evidence of an arrangement.