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Revenue recognition for multiple-element arrangements as occurred in the Xerox case discussed in this chapter calls for determining the stand-alone selling price for each of the deliverables and using it to separate out the revenue amounts. Why do you think it is important to separate out the selling prices of each element of a bundled transaction? How might the separation affect recorded revenue in the period of sale and in future periods? How do these considerations relate to what Xerox did to manage its earnings?

Reference no: EM13866406

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