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On January 4, 2021 Alpha Computers signed a contract with Beta Protection, to install new computers at 40 work stations as well as connect to network all of the computers. Beta has also offered to provide service support for one year after the connection is complete. Alpha Computers uses the contact-based approach for revenue recognition.
Contract details include the following:
Question 1: Use the 5-step approach to revenue recognition under the contract-based approach and recommend how Alpha Computers should record cash received and when to recognize different types of revenues.
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