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Apply Five-Step Revenue Recognition Model Practice Test
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Q1
TravelSite.com operates a website that allows customers to book hotel rooms from various hotel chains. TravelSite.com facilitates the booking and processes the customer's payment. The hotel is responsible for providing the accommodation and is liable for the quality of the service. TravelSite.com earns a 12% commission on the booking price. A customer books a room for $500 through the website.
In this transaction, TravelSite.com is acting as an agent. How much revenue should TravelSite.com recognize from this booking?
In this transaction, TravelSite.com is acting as an agent. How much revenue should TravelSite.com recognize from this booking?