Name ____________________________
Chapter 10
Marketing/Sales/Collection/Customer Support Process: Recording
and Evaluating Revenue Process Activities
Directions: Identify a page number on which you find the identified text feature. Develop a question
that your peers could answer that would help them understand the importance of this feature. Plus,
write a sentence using the content. The first two has been completed for you.
Text Feature
Page (s)
Question from the text
Unit Title – Revenue
276
What revenue processes apply in all situations?
Recognition
a. Determine marketing and distribution channels
b. Receive and accept orders
c. Deliver goods and services
d. Receive payments from customers
e. Provide customer support
1. First two are not accounting events because
they do not impact on the company’s assets,
liabilities, and or owner’s equity. The second
may have an expenditure process event if
expenses are incurred in the process.
2. The last three are accounting events
because they impact assets, liabilities and/or
owner’s equity.
3. The fourth event sometimes precedes the
third event.
4. The last event may have an expenditure
process impact as well
Heading – Revenue Recognition
276
When is revenue recognized?
 Revenues are recognized when they have
been earned and realized.
What does each of these components mean?
 Declares that revenues are earned and when
an entity has substantially accomplished
what is must do to be entitled to the
benefits represented by the revenues.
 Revenues are realized when an exchange
has taken place and the company receives
cash, a claim to cash, or some other increase
in net assets.
 Revenues are also realized when a company
receives some other noncash asset or has its
liabilities reduced.
For example, if a company accepts a piece of
equipment valued at $15,000 in exchange for
services rendered, it will record revenue of $15,00
because it has performed all services necessary to
earn the revenue and it has received a noncash asset
with a cash equivalent value of $15,000.
Name ____________________________
Heading –Revenue Recognized
When Cash Collected
279
Heading – Revenue Recognized
before Cash Collected (Asset
Created)
279
Heading – Revenue Recognized
after Cash Received (Liability
Incurred
Heading—Sales Returns and
Allowances
Heading—Sales Discounts
279
Unit Heading – Costs of Goods
Sold
Heading – Specific Identification
Method
Heading– First-In, First-Out
(FIFO) Method
Heading– Last-In, First-Out(LIFO)
Method
283
Heading – Periodic Inventory
System and Cost Flow
Assumptions
290
Heading – FIFO, LIFO, and GAAP
External Reporting
291
Unit Title – Estimating
Uncollectible Credit Sales
Heading – Proper Income
Measurement
Heading -- Proper Asset
Valuation
Heading – Recording Estimated
Uncollectible Accounts
Heading – Recording Actual
Uncollectible Accounts
291
Unit Title – Reporting Revenue
Process Events
Heading – Estimating Cash
Receipts from Customers
292
280
281
283
283
287
291
292
292
293
293
Name ____________________________
Glossary – Define and use in a sentence
FIFO
LIFO
Net realizable value
Sales Discount
Sales price variance
Sales quantity variance
Sales Returns and Allowances
Specific Identification Method