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Revenue recognition descrepancy

The revenue schedule is showing 8.40 recognized in February or 14.24%.
If I look at the total days in February, 4 days, the $59 charge is split over 28 days, so 59/28 * 4 (no. days of recognition in Feb) = 8.428 which should be rounded to 8.43 not the 8.40 which is displayed.

 

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Re: Revenue recognition descrepancy

This revenue schedule is using a Monthly recognition over time rev rec rule and based on that rule settings, we just use the number of days to split the monthly amount between the two partial months, and spread the remainder over the trailing months of recognition term.

 

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Invoice item service period 02/25/2017 to 03/24/2017, which is total 28 days, 4 days in Feb, and 24 days in Mar.

 

As the currency is USD, so we need to note that the decimal plance is 2, so when do the calculation, we only count to 2 decimal plance to get the reminder.

 

59/28= 2.10 with reminder, 59 - 2.10 * 28 = 0.20

 

Based on the rounding rul, reminder will be spread over the trailing months of recognition term, which will be 0.01 per day from 03/24/2017 to 03/05/2017.

 

So for Feb, 2.10 * 4 = 8.40 will be recognized, for Mar, 2.10 * 24 + 0.2 = 50.60 will be recognized.



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