Revenue of 123,750 in year one, not 144,000 at signing, is where the AC300 Unit 10 revenue recognition analysis lands after five steps on a composite dental imaging contract. Searches like "ac 300 unit 10 assignment example", "ac300 unit 10 sample" and "ac300 unit 10 example" land here.
What a finished AC300 Unit 10 revenue recognition analysis looks like
Five headed sections, one per step, then a schedule and two entries. Step one confirms a contract exists. Step two identifies three performance obligations, the scanner, installation with staff training, and twenty-four months of software support, and explains why installation is distinct: other vendors could perform it and it does not modify the scanner. Step three fixes the transaction price at 144,000, with no variable consideration. Step four allocates by relative standalone selling price. Those prices total 160,000, so each obligation receives 90 percent of its own: 108,000 to the scanner, 9,000 to installation, 27,000 to support. Step five recognizes the scanner and installation at points in time and support ratably at 1,125 a month. With six months elapsed at year end, revenue is 123,750 and a contract liability of 20,250 remains.
How a AC300 Unit 10 example is structured
The five steps appear in the standard's own order because the rubric in most sections is built on it. Each step opens with the question the standard asks and closes with a one-line conclusion. Step two carries the most reasoning: the distinct test is applied twice for installation, once for whether it is capable of being distinct and once for whether it is distinct within the contract, since the second question is where answers usually stop short. Step four shows the allocation as a three-row table with the standalone prices, the ratio and the allocated amounts. Step five splits timing by obligation and states when control passes for each. The monthly schedule that follows covers the first year, and the two entries record the cash received on signing and the revenue earned by year end.
A contract that qualifies
Approval, identifiable rights, payment terms, commercial substance and probable collection, each confirmed from the facts in a single line before any obligation is named.
Three obligations and the distinct test
Scanner, installation with training, and two years of support. Installation passes both parts of the distinct test because other vendors perform it and it leaves the scanner unmodified.
Allocation by standalone price
Standalone prices of 120,000, 10,000 and 30,000 total 160,000. The 144,000 contract price is spread in the same proportions: 108,000, 9,000 and 27,000.
Timing, obligation by obligation
Scanner at delivery, installation on completion, support at 1,125 per month over twenty-four months. The point at which control transfers is named for each.
Year-end position
Six months of support earned, 123,750 recognized in total, and a 20,250 contract liability carried into the next year, with the entries that record both.
Where marks go in AC300 Unit 10
Recognizing all 144,000 at signing, or when the scanner ships, costs most of the recognition marks at once, since support is still owed for eighteen months. Allocating the 16,000 bundle discount entirely to one obligation, usually the scanner, is the next deduction; the standard spreads it proportionally unless observable evidence ties it to a specific item. Skipping the distinct analysis for installation, or asserting the answer without applying both parts of the test, loses reasoning points. Allocations that fail to sum to the transaction price reveal an arithmetic slip a grader finds immediately. Support recognized in full at the start of the term rather than ratably costs points, and a year-end position with no contract liability loses the balance sheet half of the answer. Omitting step one is penalized lightly.
Get a AC300 Unit 10 example written to your instructions
Every promise in the Unit 10 contract matters, so the case should arrive complete: each good or service, any standalone prices, payment timing, discounts or rebates, and the rubric. From those, all five steps are worked with the allocation table and entries in 24-48h. A first custom sample costs nothing.
AC300 Unit 10 questions, answered
What if the problem gives no standalone selling prices?
Then they have to be estimated, and ASC 606 names three approaches: adjusted market assessment, expected cost plus a margin, and, in narrow cases, the residual approach. Many AC300 problems supply prices for two obligations and leave the third to be estimated. The sample states which approach it used, shows the inputs, and explains why the residual approach does or does not qualify.
Why is the support revenue not recognized when the invoice is paid?
Because payment timing and performance timing are separate questions. The customer paid for everything at signing, but the company earns the support only as it stands ready to provide it each month. Cash received ahead of performance is a contract liability, and it converts to revenue month by month as the support period runs. The year-end balance of 20,250 reflects the eighteen months still owed.
Could installation be combined with the scanner as one obligation?
Yes, in some fact patterns. If installation significantly customized the scanner, or only this company could perform it, the two would form a single obligation recognized when installation finished. The sample's second step tests the facts given and reaches the opposite conclusion, but it names the facts that would change the answer, which is where many graders place their reasoning marks.