Vendor Specific Objective Evidence

accounting if the following criteria are met: * The delivered item or items have value to the customer on a standalone basis, which is satisfied in this case. * When vendor-specific objective evidence or third-party evidence of selling price for deliverables is absent, the vendor is allowed to give an objective estimation of the price of deliverable unit on standalone basis (in accordance with ASU No.2009-13), which is generally satisfiable. * If the arrangement includes a general

estimates that customers will redeem approximately 2 percent of the detergent coupons. We analyze the dollar amount of the effect of the coupons in the following two scenarios: | If there is sufficient evidence to support the 2% expected redemption rate | If there is NOT sufficient evidence to support the 2% expected redemption rate | Accrual of the coupons | Coupons to be redeemed=total coupons*expected redemption rate: 500,000*2%=10,000Total discounts= expected redeemed coupons*per coupon

selling price method, AOI must determine whether it has vendor-specific objective evidence (VSOE) of selling price (as defined below) for either or both of the separate units of accounting. If AOI has VSOE of selling price for a unit of accounting, it should use that selling price in the relative selling price method. If AOI does not have VSOE of selling price for a unit of accounting, it should determine whether it has third party evidence (TPE) of selling price (as defined below). If AOI does

The delivered item or items have value to the customer on a standalone basis. The item or items have value on a standalone basis if they are sold separately by any vendor or the customer could resell the delivered item(s) on a standalone basis. In the context of a customer's ability to resell the delivered item(s), this criterion does not require the existence of an observable market for the deliverable(s).

Chapter 4: Financial System in Telecommunication Industry: Mahindra Comviva Mahindra Comviva is one of industry in telecommunication sector that provides value added services for mobile operators. The company is among the leader of mobility solutions providing a suite of productized solutions. In the organization a proper mechanism of financial system plays a key role. An effective and efficient process and procedure of financial management is essentially necessary to maintain a financial health

revenue for PCS would be “deferred and recognized in income over the one-year post-contract customer support service period” assuming the “lack of vendor-specific objective evidence of the fair value of the delivered software element.” In reference to the example, the PCS should be accounted monthly over the 12-month period. There is no “vendor-specific objective” because the product and the service are not sold separately. 2. The items should be accounted separately. In example 4, section 605-10,

2. Purchases are requisitioned by a purchasing department that seeks the best prices and quality.    True    False   3. The accounts payable department reconciles the vendor invoice, purchase order, and receiving report prior to approving the payment to the vendor.    True    False   4. Bill of ladings for goods shipped from a vendor to the purchasing company should always include the company's purchase order number.    True    False

In this case, vendor-specific objective evidence of fair value is limited to the price charged when the same element is sold separately. Of the $12,000 Feb 1 agreement, $10,286 will be allocated to the Volcano System and $1,714 will be allocated to the PCS. The portion of the fee allocated

accounting units of system and PCS will be accounting for separately, because the criteria of ASC 605-25-5-a are met: “The delivered item or items have value to the customer on a standalone basis. The item or items have value on a standalone basis if any vendor sells them separately or the customer could resell the delivered item(s) on a standalone basis. In the context of a customer's ability to resell the delivered item(s), this criterion does not require the existence of an observable market for the deliverable(s)

General Background Info Social Konnections Inc. (SKI) is an international corporation that runs a large and popular social media platform designed for networking. Since its launch in 2005, SKI is developing at a steep rate of growth. SKI’s initial public offering was in 2010 and now has over 500 million active users. In the previous fiscal year, almost all of the company’s revenue came from advertisers who place their product ads on the social media website and it’s corresponding mobile platforms