Explain the revenue recognition process when a performance obligation is satisfied over time according to IFRS 15-Revenue from Contracts with Customers.
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Explain the revenue recognition process when a performance obligation is satisfied over time according to IFRS 15-Revenue from Contracts with Customers.
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- Topic: REVENUE FROM CONTRACTS WITH CUSTOMERS Requirements: a. Identify the performance obligations in the contracts. b. How should the entity recognize revenue from the contract? (State also the timing of revenue recognition for each identified performance obligation.)The FASB has established a Five-Step process to recognize revenue. Which of the following is not one of those steps? A. Ability to identify the contract with the customer. B. Determination thatcollection of the entitled contractual consideration from the customer is probable. C. Properly identify all of the performance obligations within the contract. D. Ability to determine the transaction price. E. Properly identify all of the deliverables and allocate the transaction price to each.Demonstrate revenue recognition for long-term contracts, both at a point intime when the contract is completed and over a period of time according to thepercentage completed.
- Companies recognize revenue when goods or services are transferred to customers for the amount the company expects to be entitled to receive in exchange for those goods or services. That core principle is implemented by (1) identifying a contract with a customer, (2) identifying the performance obligations in thecontract, (3) determining the transaction price of the contract, (4) allocating that price to the performanceobligations, and (5) recognizing revenue when (or as) each performance obligation is satisfiedUnder PFRS 15, what is the measurement basis of revenue from contracts with customers? Select the correct letter: A. Revocable amount of the consideration received or receivable B. Book value of the consideration received or receivable C. Fair value of the consideration received or receivable D. Historical cost of the consideration received or receivableThe third step in the process for revenue recognition is to (Enter 1, 2, 3, or 4 that represents the correct answer): determine the separate performance obligations in the contract. allocate transaction price to the separate performance obligations. determine the transaction price. determine the amount of revenue when each performance obligation is satisfied.
- When a company has a contract involving multiple performance obligations, how must the company recognize revenue?Explain the 5 step Revenue Recognition process as found in IFRS 15-Revenue from Contracts with Customers.1. Record the preceding transactions in MSK's books assuming it recognizes revenue over time and uses costs incurred to measure the extent to which its performance obligation has been satisfied.
- Topic: REVENUE FROM CONTRACTS WITH CUSTOMERS Requirments: a. Compute for the total discount granted to the customer. b. Allocate the transaction price to the performance obligations in the contract.Briefly describe the guidelines provided by GAAP for the recognition of revenue by a franchisor for an initialfranchise feeWhat is Revenue Recognition Companies should recognize revenue in the accounting period in which a contract is finalized Companies should recognize revenue in the accounting period in which services are performed. O Companies should ecognize revenue when the customer pays its bill