IDENTIFYING PERFORMANCE OBLIGATIONS AA COMPUTERS LICENSES CUSTOMER RELATIONSHIP SOFTWARE TO ABS COMPANY. IN ADDITION TO PROVIDING THE SOFTWARE ITSELF. AA COMPUTERS PREMISES TO PROVIDE CONSULTING SERVICES BY EXTENSIVELY CUSTOMIZING THE SOFTWARE TO AB’S INFORMATION TECHNOLOGY ENVIRONMENT, FOR A TOTAL CONSIDERATION OF 3,456,000. IN THIS CASE, AA COMPUTERS IS PROVIDING A SIGNIFICANT SERVICE BY INTEGRATING THE GOODS AND SERVICES (THE LICENSE AND THE CONSULTING SERVICE) INTO ONE COMBINED ITEM FOR WHICH ABS HAS CONTRACTED. IN ADDITION, THE SOFTWARE IS SIGNIFICANTLY CUSTOMIZED BY AA COMPUTERS IN ACCORDANCE WITH SPECIFICATIONS NEGOTIATED BY ABS. REQUIRED: IS THIS A ONE PERFORMANCE OBLIGATION OR A SEPARATE PERFORMANCE OBLIGATIONS.

Understanding Business
12th Edition
ISBN:9781259929434
Author:William Nickels
Publisher:William Nickels
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
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IDENTIFYING PERFORMANCE OBLIGATIONS

AA COMPUTERS LICENSES CUSTOMER RELATIONSHIP SOFTWARE TO ABS COMPANY. IN ADDITION TO PROVIDING THE SOFTWARE ITSELF. AA COMPUTERS PREMISES TO PROVIDE CONSULTING SERVICES BY EXTENSIVELY CUSTOMIZING THE SOFTWARE TO AB’S INFORMATION TECHNOLOGY ENVIRONMENT, FOR A TOTAL CONSIDERATION OF 3,456,000. IN THIS CASE, AA COMPUTERS IS PROVIDING A SIGNIFICANT SERVICE BY INTEGRATING THE GOODS AND SERVICES (THE LICENSE AND THE CONSULTING SERVICE) INTO ONE COMBINED ITEM FOR WHICH ABS HAS CONTRACTED. IN ADDITION, THE SOFTWARE IS SIGNIFICANTLY CUSTOMIZED BY AA COMPUTERS IN ACCORDANCE WITH SPECIFICATIONS NEGOTIATED BY ABS.

REQUIRED: IS THIS A ONE PERFORMANCE OBLIGATION OR A SEPARATE PERFORMANCE OBLIGATIONS.

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