On June 1, 2024, Emmet Property Management entered into a 2-year contract to oversee leasing and maintenance for an apartment building. The contract starts on July 1, 2024. Under the terms of the contract, Emmet will be paid a fixed fee of $66,000 per year and will receive an additional 10% of the fixed fee at the end of each year provided that building occupancy exceeds 80 %, Emmet estimates a 20% chance it will exceed the occupancy threshold, and concludes the revenue recognition over time is appropriate for this contract. Assume Emmet estimates variable consideration as the most likely amount. How much revenue should Emmet recognize on this contract in 2024? Multiple Choice $33,000 $66,000 $33,660 $36,750
On June 1, 2024, Emmet Property Management entered into a 2-year contract to oversee leasing and maintenance for an apartment building. The contract starts on July 1, 2024. Under the terms of the contract, Emmet will be paid a fixed fee of $66,000 per year and will receive an additional 10% of the fixed fee at the end of each year provided that building occupancy exceeds 80 %, Emmet estimates a 20% chance it will exceed the occupancy threshold, and concludes the revenue recognition over time is appropriate for this contract. Assume Emmet estimates variable consideration as the most likely amount. How much revenue should Emmet recognize on this contract in 2024? Multiple Choice $33,000 $66,000 $33,660 $36,750
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter17: Advanced Issues In Revenue Recognition
Section: Chapter Questions
Problem 7C: On January 1, 2019, Mopps Corp. agrees to provide Conklin Company 3 years of cleaning and janitorial...
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Transcribed Image Text:On June 1, 2024, Emmet Property Management entered into a 2-year contract to oversee leasing and maintenance for an apartment building. The contract
starts on July 1, 2024. Under the terms of the contract, Emmet will be paid a fixed fee of $66,000 per year and will receive an additional 10% of the fixed fee
at the end of each year provided that building occupancy exceeds 80 %, Emmet estimates a 20% chance it will exceed the occupancy threshold, and
concludes the revenue recognition over time is appropriate for this contract.
Assume Emmet estimates variable consideration as the most likely amount. How much revenue should Emmet recognize on this contract in 2024?
Multiple Choice
$33,000
$66,000
$33,660
$36,750
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