Amount received upfront and what will be the criteria to recognize revenue.

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Accepted Answer

Amount received upfront and criteria for revenue recognition

The amount received upfront is recognized as a liability until the revenue recognition criteria are met
Revenue recognition criteria include delivery of goods or services, customer acceptance, and collectibility
Revenue is recognized when the criteria are met and the liability is released
The revenue recognition method used depends on the nature of the transaction and the industry standards
Examples of revenue recognition methods include percentage of completion, completed contract, and installment sales

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