Under GAAP, with respect to multiple-element arrangements, if the revenue for a particular part of a multiple-element arrangement does not qualify for separate recognition, it is:
A) Never recognized.
B) Recognized when the contract is signed or persuasive evidence of an arrangement exists.
C) Recognized when revenue for the other parts is recognized.
D) Recognized at the end of the contract.

Question

Quizplus · Accepted Answer

Under GAAP, revenue for individual parts of a multiple-element arrangement can only be recognized separately if the parts qualify for separate recognition under specific criteria. If the revenue for a particular part does not qualify for separate recognition, it is recognized when revenue for the other parts is recognized. Therefore, the best choice is C.

Under GAAP, with Respect to Multiple-Element Arrangements, If the Revenue