Clear up substance in ASC

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Aug 6th, 2022
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How to clear up substance in ASC

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hello and welcome to our webcast Iamp;#39;m Amy Pendergrass with moss Adams and Iamp;#39;m going to get us started for todayamp;#39;s session ASC lease accounting update before we begin Iamp;#39;m going to play a brief video welcome and thanks for joining weamp;#39;re pleased to present our continuing professional education webcast series before we begin please keep the following in mind you can customize how you view our presentation and interact with the presenter for better viewing close all other applications and turn up your speaker volume you can adjust window size and placement or enter full screen mode using the controls at the top right of the window or dragging the bottom right hand corner to resize at the bottom of your screen youamp;#39;ll see a series of icons that relate to a different aspect of our session you can download a PDF of todayamp;#39;s slides from the slide deck and handouts widget you can ask questions by typing in the Q a window and clicking submit we

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ASC 606-10-05-3 The core principle of this Topic is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.
Step 4 of the new five-step revenue recognition standard i.e. ASC 606, requires the allocation of the transaction price to each performance obligation in a contract with a customer. The transaction price is the basis for measuring revenue. It is not always the price set in the contract.
2) Identify the Performance Obligations in the Contract The second step in the process involves identifying the performance obligations within the contract. Performance obligations are a companys distinct promises to transfer goods or services to its customers.
What are the five steps of revenue recognition under ASC 606? Identify the contract. Identify performance obligations. Determine the transaction price. Allocate the transaction price. Recognize revenue as the performance obligation is satisfied.
Any transfer of a nonfinancial asset in exchange for a noncontrolling ownership interest in another entity (including a noncontrolling ownership interest in a joint venture or other equity method investment) should be accounted for in ance with ASC 610-20.
Step 1: Identify the Contract with a Customer. Step 2: Identify the Performance Obligations in the Contract. Step 3: Determine the Transaction Price. Step 4: Allocate the Transaction Price to the Performance Obligations in the Contract. Step 5: Recognize Revenue When (or As) the Entity Satisfies a Performance Obligation.
The Financial Accounting Standards Board (FASB) created a five-step approach that entities should apply when determining the amount and timing of revenue recognition: Step 1: Identify the contract with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price.
2. Identify the performance obligations in the contract. Performance obligation is the promise the business makes to transfer goods or services to the customer. During this step, businesses should itemize every distinct performance obligation.

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