Under which of the following circumstances would a company need to consider whether products or services within a contract are distinct? O when a performance obligation is implicit rather than explicit O when timing of revenue recognition for a performance obligation is unclear O when there are no customary business practices related to a performance obligation when a revenue arrangement involves more than one performance obligation

Under which of the following circumstances would a company need to consider whether products or services within a contract are distinct? O when a performance obligation is implicit rather than explicit O when timing of revenue recognition for a performance obligation is unclear O when there are no customary business practices related to a performance obligation when a revenue arrangement involves more than one performance obligation

Accounting Information Systems

10th Edition

ISBN:9781337619202

Author:Hall, James A.

Publisher:Hall, James A.

Chapter7: The Conversion Cycle

Section: Chapter Questions

Problem 9MCQ: Which of the following statements regarding traditional accounting is true? a. Traditional...

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Ac. When a transaction involves multiple performance obligations in a single transaction Select one : a . All revenue can be recognized once the product has been delivered and the service has been provided . b . The revenue must be deferred until the last performance obligation has been completed c . The performance obligations involve products but not services d . The seller must separate the revenue into two or more elements
Define ‘control’ and state what would be the acceptable indicators for the transfer of control from the seller to the customer when the performance obligation is satisfied at a point in time according to IFRS 15-Revenue from Contracts with Customers.
When a company has a contract involving multiple performance obligations, how must the company recognize revenue?
Statement I: IFRS 15 prescribes specific estimation techniques for variable consideration and only permits variable amounts to be included to the extent that it is probable that the revenue will not reverse.Statement Il: Transaction price (at inception) should be allocated to all the performance obligations in the contract in proportion to the cost of each performance obligation. • True, True • True, False • False, False • False, True
Journalizing multiple performance obligations and sales transactions Journalize the following sales transactions for Morris Supply. Explanations are not required.
Under the completed-contract method, Question 16 options: a revenue, cost, and gross profit are recognized at the time the contract is completed. b revenue and cost are recognized during the production cycle, but gross profit recognition is deferred until the contract is completed. c revenue, cost, and gross profit are recognized during the production cycle. d None of these answers are correct.
Which of the following statements regarding traditional accounting is true? a. Traditional accounting does not provide managers in a JIT setting with timely information. b. The financial orientation allows for effective measuring disparate items. c. Overhead allocations may lead to cost distortions. d. All of the above are true statements. e. A and C are true, but B is not true.
______ is the act of using another company to provide goods or services that your company requires. A. Allocating B. Outsourcing C. Segmenting D. Leasing
For each situation, list the assumption, principle, or constraint that has been violated, if any. List only one answer for each situation. a. East Lake Company recognizes revenue at the end of the production cycle but before sale. The price of the product, as well as the amount that can be sold, is not certain. choose one of the assumption, principle or constraint Going concern assumptionPeriodicity assumptionNo violationHistorical cost principleRevenue recognition principleEconomic entity assumption b. Hilo Company is in its fifth year of operation and has yet to issue financial statements. (Do not use the full disclosure principle.) choose one of the assumption, principle or constraint Historical cost principleGoing concern assumptionRevenue recognition principleNo violationPeriodicity assumptionEconomic entity assumption c. Gomez, Inc. is…
To determine if a performance obligation exists, A. none of the alternatives are correct. B. a customer must be able to benefit from the product or service. C. the company must provide a distinct product or service. D. all of the other alternatives are correct.
Access the FASB Accounting Standards Codification at the FASB website (www.fasb.org).Required:Determine the specific citation for accounting for each of the following items:1. What alternative approaches can be used to estimate variable consideration?2. What alternative approaches can be used to estimate the stand-alone selling price of performance obligationsthat are not sold separately?
Different meanings of product costs. There are at least 3 different purposes for which we measure product costs. They are (1) pricing and product mix decisions, (2) determining the appropriate charge for a government contract, and (3) for preparing nancial statements for external reporting following Generally Accepted Accounting Principles. On the following table, indicate whether the indicated cost would be included or excluded for the particular purpose. If your answer is not denitive (include or exclude), provide a short explanation of why.