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In this session, repurchase agreements (repos) are discussed. A repurchase agreement involves one party selling an asset, like inventory, for a specific price (e.g., $100) with a simultaneous agreement to buy it back at a higher price (e.g., $106). This arrangement isn't a traditional sale; rather, it's a means of borrowing money. The seller receives cash initially but is obligated to repurchase the asset, thus maintaining ownership temporarily. Understanding these agreements is crucial for revenue recognition and determining whether a company is engaged in a repo transaction.