WGU D252- TASK 1: REVENUE RECOGNITION | ACCURATE AND
VERIFIED | 2026 UPDATE
D252-Revenue Recognition Jennifer Ater
Student ID: 010271689
KTSB and Ramesses II Agreement
A. After reviewing the agreement between KTSB and Ramesses II,
potential accounting issues have been found relating to the recognition
of review by KTSB regarding the sale of computers to Ramesses II.
o KTSB received an order from Ramesses II for 300 Model E
computers, terms n/90, to be accepted and put on warehouse
floors by September 1st. Legal title transfers at point of delivery
however, Ramesses II has the right to return any unsold
computers to KTSB within 90 days of purchase. Revenue
recognition issue: accounting for a refund liability.
o A manufacturing coupon for $100 off the purchase of a Model E
was issued by KTSB with a 90-day expiration date. KTSB has
agreed to reimburse Ramesses II for any coupons received by
customers in their stores. Revenue recognition issue: accounting
for variable consideration and a liability.
o Ramesses II agreed to sell KTSB’s gift cards at their kiosks. KTSB
has agreed to pay Ramesses II a commission of 3% on the value
of the gift cards sold. Revenue recognition issue: deferred
revenue and accounting for the liability
o Ramesses II will accept warranty claims for the computers within
the first year. They are to provide the customers with either a full
refund or a replacement computer and then return the faulty
computers to KTSB. KTSB will reimburse Ramesses II for the
refund or exchange plus shipping costs. Revenue recognition
issue: accounting for warranties as a performance obligation.
B. To: KTSB Management
VERIFIED | 2026 UPDATE
D252-Revenue Recognition Jennifer Ater
Student ID: 010271689
KTSB and Ramesses II Agreement
A. After reviewing the agreement between KTSB and Ramesses II,
potential accounting issues have been found relating to the recognition
of review by KTSB regarding the sale of computers to Ramesses II.
o KTSB received an order from Ramesses II for 300 Model E
computers, terms n/90, to be accepted and put on warehouse
floors by September 1st. Legal title transfers at point of delivery
however, Ramesses II has the right to return any unsold
computers to KTSB within 90 days of purchase. Revenue
recognition issue: accounting for a refund liability.
o A manufacturing coupon for $100 off the purchase of a Model E
was issued by KTSB with a 90-day expiration date. KTSB has
agreed to reimburse Ramesses II for any coupons received by
customers in their stores. Revenue recognition issue: accounting
for variable consideration and a liability.
o Ramesses II agreed to sell KTSB’s gift cards at their kiosks. KTSB
has agreed to pay Ramesses II a commission of 3% on the value
of the gift cards sold. Revenue recognition issue: deferred
revenue and accounting for the liability
o Ramesses II will accept warranty claims for the computers within
the first year. They are to provide the customers with either a full
refund or a replacement computer and then return the faulty
computers to KTSB. KTSB will reimburse Ramesses II for the
refund or exchange plus shipping costs. Revenue recognition
issue: accounting for warranties as a performance obligation.
B. To: KTSB Management
