Case 10-11 Solution

Powerful Essays
1. Is Eye Vision’s arrangement with Holland Hospital within the scope of ASC 985-605, Software: Revenue Recognition?
In this case, the main content of the Eye Vision’s arrangement with Holland Hospital include embedded software medical equipment and an initial option to purchase a two-year separately priced maintenance agreement.
In this case, because“Eye Vision has never sold, nor does it offer to sell, the Clear View Laser without the embedded software because the software is necessary to perform the medical procedures for which the laser is intended”, and “Eye Vision has never sold, nor does it offer to sell, the Clear View Laser without the embedded software because the software is necessary to perform the medical procedures for which the laser is intended”. So the software components and non software components of tangible product could be consider function together to deliver the tangible product’s essential functionality, so according the FASB codification 985-605-15-4 and 985-605-15-4A, the equipment and the software are excluded from the Software: Revenue Recognition., Accordingly, the initial option to purchase a two-year separately priced maintenance agreement on the Clear View would be nonsoftware deliverables excluded from the scope of Software: Revenue Recognition.
References from FASB codification
ASC 985-605-15-4
The guidance in this Subtopic does not apply to the following transactions and activities: e. Software components of tangible products that are sold, licensed, or leased with tangible products when the software components and nonsoftware components of the tangible product function together to deliver the tangible product’s essential functionality.

ASC 985-605-15-4A a. If sales of the tangible product without the software elements are infrequent, a rebuttable presumption exists that software elements are essential to the functionality of the tangible product.

2. What are the deliverables in this arrangement?

You May Also Find These Documents Helpful

  • Satisfactory Essays

    114141023 RezwanaAfnan 114141010 Sk. Zenin 114133004 HumayraZahirSaima 114123016 United International University Date: 26-04-2015 Table of Contents Foundations of Group Behavior 1 Ethical Dilemma 1 Case Incidence-1 1 Case Incidence-2 2 Understanding Work Teams 4 Ethical Dilemma 4 Case incidence-1 4 Case Incidence-2 5 Communication 7 Ethical Dilemma 7 Foundations of Group Behavior Ethical Dilemma Ans to the Qus No-1 Yes, of course. We agree that those who are trying to avoid their duties in a group…

    • 2365 Words
    • 9 Pages
    Satisfactory Essays
  • Good Essays

    Eye Vision Case 10-11

    • 2115 Words
    • 9 Pages

    Eye Vision Case 10-11 Eye Vision Inc, a long-standing medical device manufacturer, has signed a contract to sell Holland Hospital the Clear View Laser and a two-year separately priced maintenance plan for $1 million and $0.2 million respectively. On a when-and-if available bais, Eye Vision Inc. will provide software updats that is embedded with the Laser to maintainance purchasor. The software has never been sold without Laser for its functional necessity. In this memo, as explained below, we conclude…

    • 2115 Words
    • 9 Pages
    Good Essays
  • Good Essays

    Ch 10 Solutions

    • 17388 Words
    • 152 Pages

    CHAPTER 10 Acquisition and Disposition of Property, Plant, and Equipment ASSIGNMENT CLASSIFICATION TABLE (BY TOPIC) Topics Questions Brief Exercises 1, 2, 3, 4, 5, 13 Concepts Problems for Analysis 1. Valuation and classification of land, buildings, and equipment. 1, 2, 3, 4, 6, 7, 12, 13, 15, 21 2. Self-constructed assets, capitalization of overhead. 5, 8, 20, 21 4, 6, 12, 16 3. Capitalization of interest. 8, 9, 10, 11, 2, 3, 4 13, 21 4, 5, 7, 8, 9, 10, 16 1, 5, 6, 7 3 4. Exchanges…

    • 17388 Words
    • 152 Pages
    Good Essays
  • Good Essays

    Experiment 10 & 11

    • 1216 Words
    • 5 Pages

    Experiment #10 & #11 The Synthesis of Cobalt Oxalate Hydrate The Synthesis of a Nitrite Complex February 5, 2012 Chemistry 1211L - 146 - Spring 2012 Procedure The Synthesis of Cobalt Oxalate Hydrate Place 100 ml of distilled water in a 250-ml (or 400-ml) beaker. Add 1.26g of oxalic acid dihydrate (H2C2O4.2H2O) and 1 ml of concentrated ammonia. Stir the mixture until the solid has dissolved completely. Dissolve 2.34 g of cobalt chloride hexahydrate (CoCl2.6H2O) in 100 ml of water…

    • 1216 Words
    • 5 Pages
    Good Essays
  • Better Essays

    Ch 11 Solutions

    • 7520 Words
    • 31 Pages

    11 Service Department and Joint Cost Allocation Solutions to Review Questions 1. Companies allocate costs to estimate or assess the costs of their activities (products, processes, etc.). It is an estimate and subject to the problem that cost allocation contains an arbitrary element. Not allocating costs, however, is also an estimate—an estimate of zero. This may be appropriate for some decisions, but not for others. Some of the disadvantages (costs) include: (1) Additional…

    • 7520 Words
    • 31 Pages
    Better Essays
  • Good Essays

    Weighy 10 11

    • 334 Words
    • 1 Page

    Sovde, H. (2010, 04 18). Lessons for Successful Long-term Innovation. Retrieved 11 10, 2014, from www.strategicinnovation.org:…

    • 334 Words
    • 1 Page
    Good Essays
  • Satisfactory Essays

    Chapter 11 Solutions

    • 5478 Words
    • 59 Pages

    11 Balanced Three-Phase Circuits Assessment Problems AP 11.1 Make a sketch: We know VAN and wish to find VBC . To do this, write a KVL equation to find VAB , and use the known phase angle relationship between VAB and VBC to find VBC . VAB = VAN + VNB = VAN − VBN Since VAN , VBN , and VCN form a balanced set, and VAN = 240/ − 30◦ V, and the phase sequence is positive, VBN = |VAN |//VAN − 120◦ = 240/ − 30◦ − 120◦ = 240/ − 150◦ V Then, VAB = VAN − VBN = (240/ − 30◦ ) − (240/ − 150◦ ) = 415.46/0◦ V…

    • 5478 Words
    • 59 Pages
    Satisfactory Essays
  • Powerful Essays

    Chapter 11 Solutions

    • 5001 Words
    • 81 Pages

    CAPITAL BUDGETING PROBLEMS: CHAPTER 11 Answers to Warm-Up Exercises E11-1. Categorizing a firm’s expenditures Answer: In this case, the tuition reimbursement should be categorized as a capital expenditure since the outlay of funds is expected to produce benefits over a period of time greater than 1 year. E11-2. Classification of project costs and cash flows Answer: $3.5 billion already spent—sunk cost (irrelevant) $350 million incremental cash outflow—relevant cash flow $15 million per year cash…

    • 5001 Words
    • 81 Pages
    Powerful Essays
  • Powerful Essays

    Solutions Chapter 10

    • 10873 Words
    • 44 Pages

    CHAPTER 10 Standard Costing and Performance Measures for Today’s Manufacturing Environment ANSWERS TO REVIEW QUESTIONS 10-1 Management by exception is a managerial technique in which only significant deviations from expected performance are investigated. 10-2 Any control system has three basic parts: a predetermined or standard performance level, a measure of actual performance, and a comparison between standard and actual performance. The system works by making the comparison between…

    • 10873 Words
    • 44 Pages
    Powerful Essays
  • Powerful Essays

    Buckwold Chapter 11 Solutions

    • 10712 Words
    • 43 Pages

    CHAPTER 11 CORPORATIONS―AN INTRODUCTION Review Questions 1. “A corporation is an artificial person separate and distinct from its owners.” Briefly explain this statement. 2. Identify the types of relationships that can exist between a corporation and its shareholders. 3. What factors may influence the value of a corporation’s common share capital? 4. Identify two ways in which a shareholder can realize a return on a share investment. Describe the relationship between them.…

    • 10712 Words
    • 43 Pages
    Powerful Essays