On June 1, 2021, Emmet Property Management entered into a 2-year contract to oversee leasing...
70.2K
Verified Solution
Link Copied!
Question
Accounting
On June 1, 2021, Emmet Property Management entered into a 2-year contract to oversee leasing and maintenance for an apartment building. The contract starts on July 1, 2021. Under the terms of the contract, Emmet will be paid a fixed fee of $54,000 per year and will receive an additional 10% of the fixed fee at the end of each year provided that building occupancy exceeds 80%. Emmet estimates a 20% chance it will exceed the occupancy threshold, and concludes the revenue recognition over time is appropriate for this contract. Assume Emmet estimates variable consideration as the expected value. How much revenue should Emmet recognize on this contract in 2021?
Multiple Choice
$54,000
$27,000
$27,540
$30,750
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
