Solution-How the revenue model applies to the transaction

How the revenue model applies to the transaction

Reference no: EM132468704

Part I: Background:

Day one: a college student walks into the lCoffee House on campus and orders a large cup of black coftee.
The cashier takes the order and says it will cost $5. The student hands the cashier $5. The barista then pours the coffee into a large cup and hands it to the student. The student then hustles off to accounting class.

Requirements:

Review the summary of the five-step, revenue recognition model in ASG 506-10-05-04. Also review ABC 606-10-25-1 and A80 606-10-25-30.

For each of the five steps:

Question 1: Describe how the revenue model applies to this transaction. For any step that is not applicable, simply indicate it is not applicable.

Question 2: Draw a conclusion as to whether the requirements for that step were complied with. As a final conclusion, determine the amount of revenue that should be recognized and provide the journal entry to record the transaction.

Reference no: EM132468704

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How the revenue model applies to the transaction

Reference no: EM132468704

Reference no: EM132468704

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