Walk the five-step model, map each performance obligation to over-time or point-in-time, and surface the judgments an auditor will ask about. All computation happens in your browser.
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Revenue is the most restated line in public-company financial statements, and nearly every ASC 606 problem traces to one of a handful of judgment points inside the five-step model. Step 1 — contract existence under ASC 606-10-25-1 — asks about approval, identifiable rights, payment terms, commercial substance, and probable collection; side letters and implied concessions break it more often than missing signatures do. Step 2 is where scoping goes wrong: the distinct test of ASC 606-10-25-19 has two prongs, and bundling a license with services or hardware with installation demands an explicit answer to both the capable-of-being-distinct and separately-identifiable questions for each promise.
Step 3 forces every variable amount — usage fees, rebates, penalties, refund rights — through estimation and then through the constraint of ASC 606-10-32-11/12: include variable consideration only to the extent a significant reversal is not probable. Step 4 allocates the transaction price across obligations on relative standalone selling prices (ASC 606-10-32-31), which means you need a defensible SSP for every distinct promise, observable or estimated. Step 5 decides timing: over-time recognition requires one of the three ASC 606-10-25-27 criteria, and if none holds, recognition waits for the point-in-time control transfer indicators of 606-10-25-30. Getting the pattern wrong flips quarters of revenue.
Alongside the model sits the principal-versus-agent analysis of ASC 606-10-55-36 through 55-40 — a gross-versus-net question that changes reported revenue by the full amount of pass-through cost and is a fixture of SEC comment letters for marketplaces and resellers.
This wizard walks all five steps and the principal-agent check with your contract's facts, maps each obligation to over-time or point-in-time, and surfaces exactly the judgments an auditor will probe. It computes entirely in your browser; contract details never leave it unless you choose to save them.
Identify the contract (ASC 606-10-25-1), identify the performance obligations (the distinct test in 606-10-25-19), determine the transaction price including constrained variable consideration (606-10-32-11/12), allocate it on relative standalone selling prices (606-10-32-31), and recognize revenue as each obligation is satisfied.
Two conditions under ASC 606-10-25-19: the customer can benefit from it on its own or with readily available resources (capable of being distinct), and the promise is separately identifiable from other promises in the contract (distinct within the context of the contract). Both must hold.
When any ASC 606-10-25-27 criterion is met: the customer simultaneously receives and consumes the benefits; the entity's performance creates or enhances an asset the customer controls; or the asset has no alternative use and the entity has an enforceable right to payment for performance to date. Otherwise recognition is at a point in time (606-10-25-30).
Estimate it (expected value or most likely amount), then include it only to the extent it is probable a significant revenue reversal will not occur when the uncertainty resolves (ASC 606-10-32-11/12). Penalties, refunds, usage bonuses, and price concessions all pass through this constraint.
Ask whether you control the specified good or service before it transfers to the customer (ASC 606-10-55-36 through 55-40). Control indicators include primary responsibility for fulfillment, inventory risk, and discretion in setting price. Principals report gross revenue; agents report their fee.