Which of the following statements relating to the identification of the performance obligation is incorrect?
A) The good or service to be transferred to the customer is non-distinct.
B) The entity promises to transfer a distinct, or a series of distinct, goods or services to the customer.
C) The customer can benefit from the good or service on its own or in conjunction with other readily available resources.
D) The entity's promise to transfer the good or service to the customer is separately identifiable in the contract.

Question

Quizplus · Accepted Answer

A non-distinct good or service cannot be considered a separate performance obligation, as it cannot be distinguished from other goods or services in the contract and must be combined with other promised goods or services to form a single performance obligation. The other statements are correct and relate to the criteria for identifying performance obligations in a contract, as outlined in ASC 606.

Which of the Following Statements Relating to the Identification of the Performance