The first step of the revenue recognition model is
A) to identify the contract with the customer.
B) to identify the performance obligations to the customer.
C) to recognize revenue when it is earned.
D) to determine the transaction price.

Question

Quizplus · Accepted Answer

The first step of the revenue recognition model, according to the ASC 606 and IFRS 15 standards, is to identify the contract with the customer. This step involves determining whether a contract exists, is enforceable, and specifies the rights and obligations of the parties involved.

The First Step of the Revenue Recognition Model Is