On November 1, 2021, Taylor signed a one-year contract to provide handyman services on an as-needed...
On November 1, 2021, Taylor signed a one-year contract to provide handyman services on an as-needed basis to King Associates, with the contract to start immediately. King agreed to pay Taylor $3,840 for the one-year period. Taylor is confident that King will pay that amount, but payment is not scheduled to occur until 2022. Taylor should recognize revenue in 2021 in the amount of
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$0.
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$640.
-
$1,920.
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$3,840.
Homework Answers
| As no uncertainty exists regarding payment to be received, the contract qualifies for recognition of revenue in 2021. |
| Taylor should recognize revenue in 2021 for 2 months of contract. |
| Revenue to be recognized = 3840*2/12= $640 |
| Option B $640 is correct option |
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