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hello welcome to accounting hub im professor george skyping phd in accounting and our public day is gift card so before i start our topic today please subscribe our channel you will be the first one to know when a new video arrives and like our facebook page accounting hub by dr scarping so how do we record the gift cards so sale of gift cards are recognized as deferred revenue liability if we go back to uh revenue recognition and we have a playlist about it and the playlist is in our video description we can check that to re to recognize a revenue we need to have the performance obligation performance and if we are talking about an apparel store or amazon amazon sell sell gift cards so with this gift card if i purchase a gift card from amazon i can purchase their products later when they sell the products then they will be performing the obligation and then they will recognize the revenue when a gift card is redeemed or i can lose it or the gift card maybe it has an expiration date
