CT$5$A$.7$ There are many situations in business where it is difficult to determine the proper period in which to record revenue. Suppose that after graduation with a degree in finance, you take a job as a manager at a consumer electronics store called Impact Electronics. The company has expanded rapidly in order to compete with Best Buy.

Impact has also begun selling gift cards. The cards are available in any dollar amount and allow the holder of the card to purchase an item for up to $2$ years from the time the card is purchased. If the card is not used during that $2$ years, it expires.

Instructions

At what point should the revenue from the gift cards be recognized? Include the reasoning to support your answers.