Question: [SOP 97.2, Software Revere Recognition Criteria: 2001 AICPA Technical Practice Aids adapted] ware vendor, delivers its product to a customer on January 39, 2001 purlieu to a licensing arrangement that permits the customer to eat the software indefinitely. The contract calls for payment of 5000,000 in 30days and S400.000 due in 13 months.
a. Calculate the amount of revenue that Jasmine can recognize during oath of the following periods. Justify each calculation.
(i) The fiscal year ending Minty 31, 2001.
(ii) The fiend years ending January 31. 2002 and January 31. 2003.
(iii) The fiscal year ending January 31. 2001 if the licensing period begins on March 1,2001.
b. Assuming that Jasmine is not involved with in customers; financing arrangements, explain how your answers to part a would change if the customer paid in advance of the scheduled payments.
c. Explain whether Jasmine's ability to recognize revenue would change if, on January 30. 2001, it transfers, without re-course, the rights to receive all payments to an unrelated third Party.
d. Assuming that Jasmine anticipates in a customer's financing arrangements with an unrelated party and receives payments in advance of the contractual terms,
(i) Explain whether Jasmine in recognize revenue on receipt of payment.
(ii) Describe the income statement and balance sheet impact of the payments received