Revenue Recognition Essay

Exam Question 4 According to FASB webpage, revenue is a crucial number to users of financial statements in assessing a company’s performance and prospects. However, revenue recognition requirements in U.S. GAAP differ from those in IFRS, and both sets of requirements are considered to be in need of improvements. Accordingly, the FASB and the IASB initiated a joint project to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. GAAP and IFRS that would 1)

Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. Products or services are transferred when the customer obtains control. The transfer of control to the customer represents the transfer of the rights regarding the products or services. After that, the customer has the right to use the products or services. For each performance obligation, an entity should determine whether the entity satisfies the performance obligation over time by transferring control of a good

CHAPTER 18 REVENUE RECOGNITION MULTIPLE CHOICE—Conceptual Answer​No.​Description ​c​1.​Revenue recognition principle. ​b​2.​Definition of "realized." ​a​3.​Definition of "earned." ​d​4.​Recognizing revenue at point of sale. ​d​5.​Recording sales when right of return exists. ​c​6.​Revenue recognition when right of return exists. ​d​7.​Revenue recognition when right of return exists. ​b​8.​Appropriate accounting method for long-term contracts. ​c​9.​Percentage-of-completion method

DATE: October 19, 2015 SUBJECT: Revenue Recognition according to US GAAP INTRODUCTION: This memo was written to explain and evaluate the appropriate accounting treatments specified by US GAAP. It outlines the revenue recognition principle as well as proper accounting treatments for Techco Gaming’s recent transactions. The researched sections include Revenue Recognition, Core Revenue Recognition, Single Point or Over a Period of Time Revenue Recognition, Revenue for Contracts and Financial Statement

INTRODUCTION Revenue recognition is one of the top causes for financial statement restatements. In addition, revenue recognition is an area commonly questioned by the Securities and Exchange Commission (SEC) staff in their review of public filings and resultant comment letter process. Furthermore, revenue recognition is often prey to financial fraud. Coverage of revenue recognition in intermediate accounting courses is typically limited to learning and applying the criteria for revenue recognition outlined

Therefore, the arrangement for the system would not be within the scope of ASC 985-605 and would likely fall within the scope of ASC 605-25 and 605-20. Revenue Recognition – April 30, 2012 Agreement Based on the information outlined above, the revenue recognition accounting would follow that for Multiple-Element Arrangements as outlined in ASC 605-25. The accounting units of system and PCS will be accounting for separately, because the criteria of ASC 605-25-5-a

Full Revenue Recognition. The main point is to discuss the advantages and some disadvantages of this approach for an entity. The only thing I would like to pinpoint in advance is the fact that the majority of advantages of one approach can be considered as disadvantages of another approach and vice versa. This point is specifically related to full revenue recognition and deferral of revenue approaches. Statement of Financial Accounting Concepts no 5 outlines specific criteria for revenue recognition

purchasor. The software has never been sold without Laser for its functional necessity. In this memo, as explained below, we conclude that: 1. Eye Vision’s arrangement with Holland Hospital is not within the scope of ASC 985-605, Software: Revenue Recognition. 2. The deliverables in this arrangement are the Clear View Laser, embedded software, and maintenance plan,

necessary journal entries for each year (credit Various Accounts for construction costs incurred). 2011 2012 -200,000 2013 4,000,000 4,050,000 -50,000 Revenue Expense Gross Profit All the journal entries remain the same except for entry 2). 2012 Entry: Loss on Long-term Contracts CIP (loss) 2013 Entry: Construction Expense CIP (loss) Revenue 200,000 200,000 4,050,000 50,000 4,000,000 2. Bounce Computer Corp allows customers to pay in installments for their products. Bounce only had

undertaken a joint revenue recognition project that clarifies the principles for recognizing revenue that can be applied consistently across various transactions, industries, and capital markets. This project will apply to all contracts with customers except leases, financial instruments and insurance contracts. The joint project will attempt to remove inconsistencies and weaknesses in existing revenue recognition standards by retrofitting, and thoroughly improving the recognition framework. The project