Performance obligation: Performance obligation is the promise made by the seller to supply the goods and service to the customer on or before the contract. Prepayments: Prepayment is the payment made by the customer before the supply of goods or services to the customer. In some contract, the prepayment is a nonrefundable amount which is paid by the customer. To determine: The number of performance obligations that exist in the implied contract, when a customer registers for the services.

Question

Want to see the full answer?

Answer 1

Question

Chapter 6, Problem 6.7BE

To determine

Performance obligation:

Performance obligation is the promise made by the seller to supply the goods and service to the customer on or before the contract.

Prepayments:

Prepayment is the payment made by the customer before the supply of goods or services to the customer. In some contract, the prepayment is a nonrefundable amount which is paid by the customer.

To determine: The number of performance obligations that exist in the implied contract, when a customer registers for the services.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Please give me answer general accounting question

respond to ceasar Companies make adjusting entries to ensure that their financial statements accurately reflect the true financial position and performance during a specific accounting period. These entries are necessary to account for revenues earned and expenses incurred that may not yet have been recorded in the books. Adjusting entries are typically made at the end of an accounting period, during the preparation of financial statements, as part of the accounting cycle. This step is crucial in aligning the company’s books with the accrual basis of accounting, where revenues and expenses are recognized when they are earned or incurred, rather than when cash is received or paid. By making these adjustments, companies can provide accurate and reliable financial information to stakeholders.

According to the accrual method of accounting, businesses make adjusting entries to ensure that their financial statements are correctly depicting their financial situation and performance. No matter when cash transactions take place, adjusting entries are required to record revenues when they are generated and expenses when they are incurred (Weygandt et al., 2022). In order to guarantee that financial statements present an accurate and impartial picture of their company's financial health, these entries help in bringing financial records into compliance with the revenue recognition and matching standards. In order to account for things like accumulated revenues, accrued expenses, depreciation, and prepaid expenses, adjusting entries are usually made at the conclusion of an accounting period prior to the preparation of financial statements (Kieso et al., 2020). By implementing these changes, businesses avoid making false representations in their financial reports, which enables…