Multiple arrangement revenue recognition

Assignment Help Accounting Basics

Reference no: EM1357704

Quest Tech, Inc. manufactures and sells specialized data storage equipment and services to entertainment and media companies. The equipment is used to efficiently store large data files. Quest Tech is currently marketing its latest equipment, which includes the Company's new patented technology that significantly increases its storage efficiency and reduces data corruption risk to a low level. Quest Tech entered into a contract with Dynamic Co., which operates several data centers throughout the world.

Please consider the following additional facts and write a position paper documenting Quest Tech's revenue recognition considerations and conclusions in three pages or less. You can use FASB.org for the information or any other research tool.

- Quest will deliver five data storage units to Dynamic. Dynamic may purchase additional units at a discount of 35% off the list price.

- Quest Tech will provide maintenance services for a period of 1 year. Dynamic has the option to extend these services on an annual basis.

- Quest Tech will install the Equipment no later than 30 days after delivery.

- Dynamic will pay to Quest Tech the sum of $5,000,000 upon execution of this agreement.

- In the event Dynamic renews the maintenance services, Dynamic will pay to Quest Tech the sum of $1,000,000 upon each annual renewal. Other vendors provide installation services, but Quest Tech does not provide installation services separately.

- Quest Tech's competitors sell similar equipment for $1,000,000 per unit.

Reference no: EM1357704

Questions Cloud

Will have to rise the money supply to keep the price level : will have to rise the money supply to keep the price level from falling.can keep the price level stable without altering the money supply or interest rate.

Psychopharmacological and non-pharmacological treatment : Clinical Psych: depression and manic-depression/challenges in assessment, differential diagnosis, and use of psychopharmacological and non-pharmacological treatment.

How much of the rope must be pulled : How much of the rope must be pulled. Find the magnitude of the magnetic field at the point x = 0, y = 0.7 m, z = 0.

Dealing with disruptive innovation : Prepare a short outline and explain the possible ways companies can deal effectively with a disruptive innovation. Response must include examples.

Multiple arrangement revenue recognition : Quest Tech, Inc. manufactures and sells specialized data storage equipment and services to entertainment and media companies.

Elucidate how long must a quota in effect to have an impact : Elucidate how long must a quota be in effect to have an impact. Using a demand-and-supply diagram, illustrate and explain the net welfare loss from imposing such a quota.

Using leadership styles to progress from a manager to a lead : Using leadership styles to progress from a manager to a leader - how would one use their primary leadership style of Facilitating, Coaching, Delegating, Directing (

Physical and psychological distress : The relationship between depression and substance abuse are common stressors that cause physical and psychological distress.

Design switched network to compliment routed network : Design a switched network to compliment your routed network. Each department will require five switches that will plug into the router cards.

User Account

All Pages