Which of the Following Would Not Be Considered a Multiple-Deliverable

question 145

Multiple Choice

Which of the following would not be considered a multiple-deliverable arrangement?

• A) A product sold with a manufacturer's warranty, where both the product and warranty have separately identifiable revenue streams.
• B) A product sold with a manufacturer's warranty which covers only product assurances, where only the product has a separately identifiable revenue stream.
• C) Customer Loyalty Programs.
• D) Franchise Fees.

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Definitions:

Uncollectible Accounts

Accounts from which businesses are unable to obtain payment, often leading to writing off these amounts as a bad debt expense.

Allowance Method

A method used in accounting to estimate the amount of uncollectible accounts receivable. This ensures revenues and expenses are matched in the period they are incurred.

Allowance for Doubtful Accounts

This is a contra-asset account used to estimate the portion of accounts receivable that may not be collectible.

Accounts Receivable

Funds that customers owe a company for goods or services already provided but not yet compensated for.