Which of the following is not one of the steps in the five-step model when goods are being sold?
A)identify the contract
B)identify the performance obligation(s)
C)recognize revenue when it has been earned
D)determine the transaction price.

Question

Quizplus · Accepted Answer

The five-step model for recognizing revenue from contracts with customers, as outlined in the accounting standards (e.g., IFRS 15 and ASC 606), includes: 1) Identify the contract with a customer, 2) Identify the performance obligations in the contract, 3) Determine the transaction price, 4) Allocate the transaction price to the performance obligations in the contract, and 5) Recognize revenue when (or as) the entity satisfies a performance obligation. The option "recognize revenue when it has been earned" is not explicitly one of the steps, as the correct phrasing is to recognize revenue when (or as) the entity satisfies a performance obligation.

Which of the Following Is Not One of the Steps