What arises when an entity performs under the contract by transferring goods or services to the customer before the consideration has been paid or is due?

Question

Quizplus · Accepted Answer

When goods or services are transferred to the customer before consideration is paid or due, a contract asset is recognized. This represents the right to consideration in exchange for goods or services that the entity has transferred to the customer. It is not considered a receivable because the consideration has not yet been earned.

What Arises When an Entity Performs Under the Contract by Transferring