The Amount of Restricted Revenue That Should Be Recognized by Pelican

question 17

Multiple Choice

The amount of restricted revenue that should be recognized by Pelican in the year of the gift is

• A) $2 million.
• B) $1,472,000.
• C) $200,000.
• D) $0.

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Definitions:

Contribution Format

A type of income statement format that separates fixed costs from variable costs to highlight the contribution margin.

Income Statement

A financial report that shows a company’s revenues, expenses, and net income over a specific period, illustrating the company’s financial performance.

Reconcile

A process of ensuring two sets of records (usually the balances of two accounts) are in agreement.

Variable Costing

A cost accounting method that encompasses solely variable costs involved in production (direct materials, direct labor, and variable manufacturing overhead) for product cost calculation.