For Contracts That Include More Than One Separate Performance Obligation

question 125

Multiple Choice

For contracts that include more than one separate performance obligation:

• A) Revenue is recorded over time at the fair value of each performance obligation.
• B) Revenue is recognized in the amount of the contract price on the date the last separate performance obligation is satisfied.
• C) The contract price is allocated to each performance obligation in proportion to the obligations' stand-alone selling prices.
• D) Revenue is recognized in the amount of the contract price on the date the contract is signed.

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Definitions:

Inversely Correlated

A relationship between two variables in which one variable increases as the other decreases.

Negatively Related

A term referring to a type of relationship where an increase in one variable is associated with a decrease in another variable.

Cognitive Dissonance

Cognitive dissonance is the mental discomfort experienced when holding two or more conflicting beliefs, attitudes, or values, often leading to changes in beliefs or attitudes to reduce the discomfort.

Cognitive Congruence

The alignment between an individual's thoughts, values, beliefs, and behaviors, leading to a state of harmony or consistency in their cognitive processes.