Background Note | HBS Case Collection | August 2000 (Revised February 2001)

Revenue Recognition

by Paul M. Healy

Abstract

This case discusses revenue recognition in straightforward situations and then considers revenue transactions that may be more complex to record. Revenue recognition criteria can be implemented for the following situations: 1) Customers pay prior to delivery; 2) Products/services are provided over multiple years; 3) Credit-worthiness of the customer is questionable; and 4) Money-back guarantees are offered.

Keywords: Business Earnings; Revenue Recognition; Decision Making; Financial Statements;

Citation:

Healy, Paul M. "Revenue Recognition." Harvard Business School Background Note 101-017, August 2000. (Revised February 2001.)