STUDY
Connect the ideas through manga.
Start with a transaction and see why the numbers move. Use manga, diagrams and tables to connect the concepts, then return to your main course and practice questions.
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Learn moreA contract for 90. How much is revenue now?
A machine and maintenance are sold together for 90. Identify the promises, allocate the price, and recognize revenue as each promise is fulfilled. Follow the five steps through one transaction.
Jun 1, 202601On June 1, a contract bundles a machine and maintenance for 90. They are two distinct performance obligations.
Jun 1, 202602At contract inception, the standalone selling prices are 60 for the machine and 40 for maintenance. Allocate 90 in the ratio 60:40.
Jun 1, 202603Allocate 54 to the machine and 36 to maintenance. Signing the contract and allocating the price do not, by themselves, create revenue.
Jun 25, 202604Control of the machine transfers on June 25, so recognize 54 as revenue. Recognize the 36 allocated to maintenance as that service is provided over the contractual service period.
FAR-33 — The Five Steps of Revenue Recognition
Explore the free UnitsTry an exercise using source records
BANK RECONCILIATION · 1 / 2
Can you reconcile both balances?
An original short bank-reconciliation example. Amounts are in dollars; there are no other differences.
June 30 — Bank statement: 12,000 / Company books: 12,580
- June 30 deposit of 1,000: recorded by the company; posted by the bank on July 1.
- Issued check of 400: recorded by the company but not cleared by June 30.
- The bank statement includes interest of 50 and a fee of 30. Neither is in the company books.
These inputs are not saved to an account. FAR-15 covers this topic in more detail.



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