5 ABC Ltd, a SaaS company sells customers a subscription service. It entered into acontract with Customer A to provide services at $36k for 12 months starting March 1,2022. The entire fee needs to be paid in advance upon signing the contract.a) Suggest accounting of the said transaction in March 2022 and April 2022?b) If ABC Ltd decides to invoice and collect the $36k at the end of the subscriptionperiod, what would be the change in answer (a) above?c) Suppose the customer is also supposed to pay $5,000 towards implementationcosts. These charges are to be paid up-front as one-time charges. How do you suggestwe recognise revenue earned from implementation costs charged to the customer?How does this affect the way we account for the expense incurred by the company onimplementation?

Subscription Services : The service provider company provide the services on the product timely as…

sub ontract with Customer A to provide services at $36k for 12 months starting March 022. The entire fee needs to be paid in advance upon signing the contract. Suggest accounting of the said transaction in March 2022 and April 2022? If ABC Ltd decides to invoice and collect the $36k at the end of the subscription eriod, what would be the change in answer (a) above? Suppose the customer is also supposed to pay $5,000 towards implementation osts. These charges are to be paid up-front as one-time charges. How do you sugg e recognise revenue earned from implementation costs charged to the customer?

sub ontract with Customer A to provide services at $36k for 12 months starting March 022. The entire fee needs to be paid in advance upon signing the contract. Suggest accounting of the said transaction in March 2022 and April 2022? If ABC Ltd decides to invoice and collect the $36k at the end of the subscription eriod, what would be the change in answer (a) above? Suppose the customer is also supposed to pay $5,000 towards implementation osts. These charges are to be paid up-front as one-time charges. How do you sugg e recognise revenue earned from implementation costs charged to the customer?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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