Section 3: 25–35%3C
Revenue Recognition
Revenue Recognition under ASC 606 is one of the most-tested FAR topics. The 5-step model applies to virtually every revenue transaction, and AICPA loves to test performance obligations and variable consideration.
What AICPA Wants You to Know
- 1Apply the 5-step revenue recognition model (ASC 606)
- 2Identify performance obligations in a contract
- 3Determine standalone selling price and allocate transaction price
- 4Recognize revenue at a point in time vs. over time
- 5Account for variable consideration, significant financing, and right of return