{"id":490,"date":"2017-11-30T07:06:36","date_gmt":"2017-11-29T23:06:36","guid":{"rendered":"http:\/\/ehluar.com\/main\/?p=490"},"modified":"2018-03-22T07:08:30","modified_gmt":"2018-03-21T23:08:30","slug":"revenue-the-5-step-model-of-new-revenue-standard-part-5","status":"publish","type":"post","link":"http:\/\/ehluar.com\/main\/2017\/11\/30\/revenue-the-5-step-model-of-new-revenue-standard-part-5\/","title":{"rendered":"Revenue &#8211; The 5-Step Model of New Revenue Standard (Part 5)"},"content":{"rendered":"<p><strong><u>Step 4 Allocate transaction price to separate performance obligations<\/u><\/strong><\/p>\n<p>8.1\u00a0\u00a0 Step 4 is to allocate <strong>the transaction price to the separate performance obligations on <u>a relative stand-alone selling price basis<\/u> under the contract.<\/strong><\/p>\n<p style=\"padding-left: 30px;\">One exception is permitted: If specified criteria are met, an entity to allocate a variable amount of consideration to one or more (but not all) performance obligations.<\/p>\n<p>8.2\u00a0\u00a0 The following are suitable methods for estimating the stand-alone selling price.<\/p>\n<p style=\"padding-left: 30px;\">(a)\u00a0\u00a0\u00a0\u00a0 Market assessment approach \u2013 an entity could evaluate the market in which it sells goods or services and estimate the price that a customer in that market would be willing to pay for those goods or services.<\/p>\n<p style=\"padding-left: 30px;\">(b)\u00a0\u00a0\u00a0\u00a0 Expected cost plus a margin approach \u2013 an entity could forecast its expected costs of satisfying a performance obligation and then add an appropriate margin for that good or service.<\/p>\n<p style=\"padding-left: 30px;\">(c)\u00a0\u00a0\u00a0\u00a0 Residual approach \u2013 an entity may estimate the stand-alone selling price by reference to the total transaction price less the sum of the observable stand-alone prices of other goods or services promised in the contract.<\/p>\n<p>8.3\u00a0\u00a0 The significant of allocating the transaction price to the separate performance obligations is that this facilitate the revenue recognition process where the revenue for each performance obligation is recognised once the performance obligation is satisfied.<\/p>\n<p>Last review: 30 November 2017<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Step 4 Allocate transaction price to separate performance obligations 8.1\u00a0\u00a0 Step 4 is to allocate the transaction price to the separate performance obligations on a relative stand-alone selling price basis under the contract. One exception is permitted: If specified criteria are met, an entity to allocate a variable amount of consideration to one or more [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[7,6],"tags":[],"class_list":["post-490","post","type-post","status-publish","format-standard","hentry","category-accounting","category-techupdates"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts\/490","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/comments?post=490"}],"version-history":[{"count":1,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts\/490\/revisions"}],"predecessor-version":[{"id":491,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts\/490\/revisions\/491"}],"wp:attachment":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/media?parent=490"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/categories?post=490"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/tags?post=490"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}