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Revenue attracts a large number of user attentions as it is the largest single number in the financial statements. It is also defined as the amount of money received by the company or an organization during a specific period of time. Revenue is also known as REVs. To give the users exact information it is essential that the revenue is recognized and measured. Discounts and deductions for returned merchandise are the amounts included in revenue recognition. To calculate revenue, selling price of the goods is multiplied with the number of amount sold. In GAAP (Generally Accepted Accounting Principle) revenue recognition is included which is an accounting principle. One of its critical components is the speed with which credit sales become cash. Methods of Revenue Recognition Assignment Help provides enhanced and great idea about revenue recognition and its methods.
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Methods
There are many types of revenue recognition methods, but some of them are not appropriate for every business. The different types of Revenue Recognition methods explained in Methods of Revenue Recognition Assignment Help are: –
• Cash Sales method: – One of revenue recognition method type is cash sales method. Here, basic buying and selling transactions are revealed. This is one of the simple revenue recognition methods. It is not mandatory for each and every transaction to qualify under cash and sales method; this is one of its disadvantages.
• Accrual Method: -One of revenue recognition method type is Accrual method. This method is a complete opposite of cash sales method. Firstly, the payments are recorded as prepaid assets and when the goods are delivered or after the shipment of the product, these recorded payments are classified as expense.
• Deposit method: – One of revenue recognition method type is deposit method. This method is used while money is kept as deposits. This deposited money is subjected to cancellation agreement by both the parties. Deposit method is explained thoroughly in Methods of Revenue Recognition Assignment Help.
• Bill and Hold Method: – One of revenue recognition method type is Bill and Hold method. Among all other revenue recognition methods, this method is least popular. This method has been quoted to be used for illegal transactions. In this method, the product ordered by the customer is billed and then has to invest its record to the manufacturer. This is done due to lack of good storage facility.
• Brokerage Agreement Method: – One of revenue recognition method type is brokerage agreement method. In this method brokers handle all the transactions with the customer. The broker works under the guidelines of both IRS (Internal Revenue Service) and SEC (Socio Economic Classes).
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