Recognizing Revenue in Different Industries
Although the methods of revenue recognition are standard across all industries, industries differ as to the methods they use to implement recognition.
Recognizing Revenue in Service Industries
Revenue recognition in service industries is composed of four different methods. These four methods are described here:
The specific performance method occurs when performance of a service consists of a single act. Under this method, revenue is recognized when the service has been completed.
The proportional performance method occurs when several similar acts are performed. Under this method, revenue is recognized as it is under the percentage of completion method.
The completed performance method occurs when more ...
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