Asked by Riley Taylor on Jul 02, 2024
Verified
The key issue with connection fees received for connecting a customer to a telecommunications network is:
A) whether they were provided by the principal or an agent.
B) whether the provision of the handset is a separate transaction.
C) whether the distribution channels used by the telecommunications companies are acting as agents or acting in their own rights as principals.
D) whether the revenue is recognised in full upfront or over an actual or implied service period.
Connection Fees
Charges levied by service providers for connecting new users to their service network, such as electricity, water, or telecommunications.
Telecommunications Network
An arrangement of computing and telecommunications resources for transmitting data and voice communications across distances.
- Discern between various instances of revenue recognition.
Verified Answer
PM
Pascal Mbuguje6 days ago
Final Answer :
D
Explanation :
The key issue with connection fees received for connecting a customer to a telecommunications network is whether the revenue is recognized in full upfront or over an actual or implied service period. This affects the timing of revenue recognition and can have a significant impact on a company's financial statements. The other choices are not directly relevant to this issue.
Learning Objectives
- Discern between various instances of revenue recognition.