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here are some revenue recognition examples regarding the right of return and repurchase agreements companies recognize that their customers may not always be satisfied with the product and usually provide the ability to return it within so many days etc this right of return is guaranteed for certain products under the companys policy when that happens the customer can receive anything from full or partial refund or credit in the store or another product in exchange for the returned product beyond that sometimes theres repurchase agreements where a company sells items but agrees that they will repurchase the ones that are not sold after a certain period of time or theres other purchase agreements where they agreed to buy the product back at a higher cost when that happens when its repurchased at greater than or equal to the sales price its considered a financing transaction so for this example there were 200 units sold and each unit costs $45 to make what was being sold at $80 retu