Reference no: EM13614827

For $50 a month, Rawl Co. visits its customers'premises and performs insect control services. If customersexperience problems between regularly scheduled visits, Rawl makesservice calls at no additional charge. Instead of paying monthly,customers may pay an annual fee of $540 in advance. For a customerwho pays the annual fee in advance, Rawl should recognize therelated revenue:

1. When the cash is collected.
2. At the end of the fiscal year.
3. At the end of the contract year after all of the services have been performed.
4. Evenly over the contract year as the services are performed.