ACC 504 Study Guide - Final Guide: Public Company
9 Feb 2016
School
Department
Course
Professor
Document Summary
Management wishes to maximize revenue and profit in anticipation of a new share issue. The company"s revenue recognition policies, as stated, are in accordance with. Ifrs already, but the two unique situations described in the case are controversial. Onsite visit - k paid by cheema, visit completed during year. Obm has recorded this as revenue no adjustment needed. Delivery of goods - k half has been received and recorded as unearned revenue. Not known if the other half has been recorded as receivable and unearned revenue, or not yet recorded at all. Criteria for recognition performance is complete, measurability is known, but collection of half is uncertain due to political situation not under customer"s control. The k that has already been received can be transferred from unearned revenue to revenue as the three criteria are satisfied. The k that is still outstanding is more problematic.
