Wiley Revenue Recognition plus Website

5Step 5—Recognize Revenue When (or as) The Entity Satisfies a Performance Obligation

1. Overview
2. Control of an Asset
   1. Direct the Use of an Asset
   2. Benefits of the Asset
   3. Other Considerations
3. Performance Obligations Satisfied Over Time
   1. Criterion 1: Customer Simultaneously Receives and Consumes the Benefit as the Entity Performs
   2. Example 5.1: Customer Simultaneously Receives and Consumes the Benefit as the Entity Performs
      1. Customer Simultaneously Receives and Benefits from a Commodity
      2. Reperforming the Work
   3. Example 5.2: Assessing Whether Another Entity Would Need to Reperform the Work Completed by the Entity to Date (Criterion 1)
   4. Criterion 2: Entity's Performance Creates an Asset that the Customer Controls as the Asset is Created or Enhanced
   5. Example 5.3: Customer Controls Work in Process
   6. Example 5.4: Customer Does Not Control the Work in Process
   7. Criterion 3: Entity's Performance Does Not Create an Alternative Use, but Entity has an Enforceable Right to Payment for Performance Completed
      1. Alternative Use
   8. Example 5.5: No Alternative Use
      1. Right to Payment for Performance Completed to Date
   9. Example 5.6: Asset Does Not have Alternative Use and Entity has Enforceable Right to Payment for Work Completed to Date
4. Performance Obligations Satisfied at a Point in Time
   1. Determining the Point in Time at Which a Performance Obligation is Satisfied
      1. The Entity has a Present Right to Payment
      2. The Entity has Transferred Legal Title to the Asset
   2. Example 5.7: Legal Title Retained Solely as a Protective ...