Chapter 5. Revenue Recognition

Definitions of Terms

86

Concepts and Examples

87

 

Revenue Recognition Scenarios

88

 

Bill and Hold Revenue Transactions

89

 

Recording Revenues at Gross or Net

89

 

Reducing Revenue by Cash Paid to Customers

90

 

Long-Term Construction Contracts

91

 

Service Revenues

93

 

Recognition of Losses on Service Contracts

94

 

Recording Initiation Fees as Service Revenue

95

 

Recording Out-of-Pocket Expense Reimbursements

95

 

Sales When Collection Is Uncertain

95

 

Repossession of Goods under Installment Sales

97

 

Revenue Recognition When Right of Return Exists

97

 

Revenue Recognition for Multiple Deliverables

98

 

Franchise Sales

99

 

Motion Picture Revenues

100

Decision Trees

100

 

Recording Revenues at Gross or Net

100

 

Recording Service Revenues

101

Policies

102

 

Revenue—General

102

 

Barter Revenues

103

 

Long-Term Construction Contracts

103

 

Sales When Collection Is Uncertain

103

 

Revenue Recognition When Right of Return Exists

104

 

Franchising Revenues

104

Procedures

104

 

Issue a Customer Credit Rating

104

 

Process a Shipment

105

 

Create an Invoice

105

 

Compare Billings to the Shipping Log

106

 

Review Pricing Errors

107

 

Process Bill and Hold Transactions

107

 

Process Sales Returns

108

 

Collect Overdue Accounts

109

 

Long-Term Construction Contracts—Percentage-of-Completion Calculation

109

 

Service Revenues—Advance Recognition of Losses

110

 

Sales When Collection Is Uncertain—Goods Repossession

110

 

Revenue Recognition When Right of Return Exists

111

Controls

111

 

General

111

 

Barter Revenues

113

 

Cash Payments to Customers

114

 

Recording Revenues at ...

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