On July 1, 2025, SEK Company sold goods to Grant Co. worth $900,000 in exchange for a 4-year, zero-interest-bearing note with a face amount of $1,416,163. The goods have an inventory cost on SEK’s books of $590,000. SEK uses the perpetual inventory method. How much revenue should SEK recognize on July 1, 2025? If none enter $0.

Seller and buyer execute a contract on January 2, 2023 for the sale of 100 red widgets at an agreed-upon price of $1.00 per widget. Between January 2, 2023 and March 30, 40 red widgets are delivered leaving 60 red widgets yet to be delivered. On April 1, 2023, the agreement was modified to add 40 blue widgets at an agreed upon sales price of $1.50 each ($1.00 is the stand alone sales price of blue widgets). So, at close of business April 1, 2023, Seller is obligated under the modified agreement to deliver 60 more red widgets plus 40 blue widgets. How much revenue should be recognized in April 2023 if Seller delivers 10 red widgets and 10 blue widgets (total of 20 widgets) during that month?

What amount of transaction price is allocated to the installation performance obligation?

How much Unearned Revenue will be reported as a liability on the December 31, 2024 balance sheet? If none enter $0

What amount of transaction price is allocated to the equipment performance obligation?

Provide brief (one or two sentence) answers to questions 1 to 8. 

Explain what is meant by variable consideration and how it is measured under U.S. GAAP (i.e., FASB ASC 606-10).

What is the transaction price assuming use of the expected value approach for measuring variable consideration?

Identify the 5 steps in the revenue recognition process in order.

On January 15, 2024, Bella Vista Company enters into a contract to build custom equipment for ABC Carpet Company. The contract specified a delivery date of March 1, 2024. The equipment was not delivered until March 31, 2024. The contract required full payment of $75,000 by April 30, 2024. On which date should Bella Vista recognize revenue on this contract?