FAR - Financial Statement Acct - Deferred Revenue Flashcards
change in the deferred revenue account calculated for a period?
cash received - revenue earned/recognized = change in period
accounts are used to record cash received from a customer before the revenue is earned?
Unearned revenue, revenue collected in advance.
How are deferred revenues expected to be earned more than one year from the balance sheet date classified?
Noncurrent liability
long-term unearned revenue account is not valued at present value?
True
deferred revenue is a liability? which occurs first - 1) receive cash w/o earning, 2) incur earning w/o rec’d cash?
True, receive cash without earning it
Deferred revenue balance, look at revenues unearned after a specified time
True
used gift certificates decrease D/R and increase revenue, because it’s earned; whereas, lapsed/expired gift cards decrease D/R and increase other income payable
True
account should be credited when gift cards are considered forfeited and the seller has no obligation to the state?
Miscellaneous revenue or sales.
amount of revenue is recognized for a period for an extended warranty when total warranty costs are not estimable?
total amount received for extended warranty multiplied by [1/(extended warranty term contract in years]
gift cards liabilities, definite liabilities, or contingent liabilities?
definite liabilities
amount of revenue is recognized for an extended warranty when total warranty costs are estimable?
total amount received for the extended warranty multiplied by the fraction: warranty costs incurred for the period divided by the total estimated warranty costs to be incurred.
Revenue from an extended warranty contract is recognized in proportion to claims costs incurred when total claims costs are estimable.
True
