When Goods and Services Are Bundled in a Sales Transaction

question 3

Multiple Choice

When goods and services are bundled in a sales transaction

• A)the service must be performed before any revenue is recognized.
• B)collection must occur before any revenue is recognized
• C)the amount of consideration received for the service must be recognized first.
• D)each performance obligation under the contract must be measured separately.

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Definitions:

Codicil

A supplemental document that modifies, explains, or revokes a will or part of a will.

Bequest

Personal property left in a will. Also called legacy.

Durable Power of Attorney

A legal document that grants a person the authority to make decisions on behalf of another person in financial or health matters, continuing in effect even if the grantor becomes incapacitated.

Numerical Limit

A specified maximum number or quantity allowed or prescribed by regulations or law.