Wiley Practitioner's Guide to GAAP 2022

39ASC 705 COST OF SALES AND SERVICES

• Perspective and Issues
  • Subtopics
• Definitions of Terms
• Concepts, Rules, and Examples
  • ASC 705-10, Overall
  • ASC 705-20, Accounting for Consideration Received from a Vendor

PERSPECTIVE AND ISSUES

Subtopics

ASC 705 contains two subtopics:

• ASC 705-10, Overall, which merely links to guidance in other Codification topics on costs of sales and services.
• ASC 705-20, Accounting for Consideration Received from a Vendor.

DEFINITIONS OF TERMS

See Appendix A, Definitions of Terms, for terms related to this topic: Cash Consideration, Contract, Customer, Probable, Reseller, Revenue, Stand-Alone Selling Price, and Vendor.

CONCEPTS, RULES, AND EXAMPLES

ASC 705-10, Overall

This Subtopic consists solely of links to other Subtopics. This is because the asset liability model requires that the applicable guidance be included in other topics:

Topic	Codification Location	Guidance
Inventory	ASC 330-10-35-1A through 35-11	Adjustments affecting cost of sales and services
	ASC 330-10-30-1 through 30-13	Adjustments affecting cost of sales and services resulting from establishing the cost basis and the use of inventory pricing methods
	ASC 606-10-32-10 and 606-10-55-22 through 55-29	Accounting for a sale with a right of return
Other Assets and Deferred Costs—Contracts with Customers	ASC 340-40	Costs related to a contract with a customer within the scope of ASC 606: Incremental costs of obtaining a contract with a customer Costs incurred in fulfilling ...