Example: Revenue Recognition over a period of Time On May 1, 20X1, Company A signed a...

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Example: Revenue Recognition over a period of Time On May 1, 20X1, Company A signed a $63,000 consulting contract with Customer B. The contract requires Company A to provide computer technology support services whenever requested over the period from May 1, 20X1, to April 30, 20X2, with Customer B paying the entire $63,000 on May 1, 20X1. Prepare the Journal Entries for May 1, 20X1, December 31, 20X1, and April 30th, 20X2? Step 1: Identify the contract with the customer. Step 2: Identify the performance obligation(s) in the contract Step 3: Determine the transaction price. Step 4: Allocate the transaction price to each performance obligation Step 5: Recognize revenue when (or as) each performance obligation is satisfied May 1, 20X1 - Date of Payment December 31, 20X1- End of the Year Adjustment April 30th, 20X1- End of the Contract Term Adjustment Example: Revenue Recognition over a period of Time On May 1, 20X1, Company A signed a $63,000 consulting contract with Customer B. The contract requires Company A to provide computer technology support services whenever requested over the period from May 1, 20X1, to April 30, 20X2, with Customer B paying the entire $63,000 on May 1, 20X1. Prepare the Journal Entries for May 1, 20X1, December 31, 20X1, and April 30th, 20X2? Step 1: Identify the contract with the customer. Step 2: Identify the performance obligation(s) in the contract Step 3: Determine the transaction price. Step 4: Allocate the transaction price to each performance obligation Step 5: Recognize revenue when (or as) each performance obligation is satisfied May 1, 20X1 - Date of Payment December 31, 20X1- End of the Year Adjustment April 30th, 20X1- End of the Contract Term Adjustment

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Step 1 Identify the contract with the customer A consulting contract was signed between Company A an... View the full answer