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Tags
#cfa-level-1 #reading-25-understanding-income-statement #revenue-recognition
Question
The [...] is similar to the revenue recognition method under IFRS, when the outcome of a contract cannot be measured reliably.
Answer
cost recovery method

Tags
#cfa-level-1 #reading-25-understanding-income-statement #revenue-recognition
Question
The [...] is similar to the revenue recognition method under IFRS, when the outcome of a contract cannot be measured reliably.
Answer
?

Tags
#cfa-level-1 #reading-25-understanding-income-statement #revenue-recognition
Question
The [...] is similar to the revenue recognition method under IFRS, when the outcome of a contract cannot be measured reliably.
Answer
cost recovery method
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3.2.2. Installment Sales
ed cash. Under the cost recovery method, the seller does not report any profit until the cash amounts paid by the buyer—including principal and interest on any financing from the seller—are greater than all the seller’s costs of the property. <span>Note that the cost recovery method is similar to the revenue recognition method under international standards, described above, when the outcome of a contract cannot be measured reliably (although the term cost recovery method is not used in the international standard). Example 4 illustrates the differences between the installment method and the cost recovery method. Installment sales and cost recovery treatment of revenue recognition are

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