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Revenue
Non-cash consideration
Any non-cash consideration is measured at fair value.
Consideration payable to a customer
If consideration is paid to a customer in exchange for a distinct good or service, then
it should be accounted for as a separate purchase transaction.
Assuming that the consideration paid to a customer is not in exchange for a distinct
good or service, an entity should account for it as a reduction in the transaction price.
1.5 Step 4: Allocate the transaction price
The total transaction price should be allocated to each performance obligation in
proportion to standalone selling prices.
Transaction price
Performance Performance
obligation 1 obligation 2
If a standalone selling price is not directly observable then it must be estimated.
Estimation methods include a residual approach, or a cost-plus approach.
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