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Fusion Receivables: Short Term and Long Term Deferred Revenue Accounting

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edited Sep 5, 2019 11:04PM in Receivables & Collections 3 comments

Summary

Fusion Receivables: Short Term and Long Term Deferred Revenue Accounting

Content

Client sells a service contract for 2 years.

AR need to book their short term (within 12 months) deferred revenue to a specific account 'X', and book their long term deferred revenue in a different account 'Y'. Below Example in Sep-19.

Service Contract - 2 years = $12000
Year 1   Year 2  
Sep-19 500 Sep-20 500
Oct-19 500 Oct-20 500
Nov-19 500 Nov-20 500
Dec-19 500 Dec-20 500
Jan-20 500 Jan-21 500
Feb-20 500 Feb-21 500
Mar-20 500 Mar-21 500
Apr-20 500 Apr-21 500
May-20 500 May-21 500
Jun-20 500 Jun-21 500
Jul-20 500 Jul-21 500
Aug-20 500 Aug-21 500
  6000   6000
Account X   Y

After a month, Oct-19, 12 months deferred revenue needs to get re-calculated, which means, 

Oct-19  Deferred Revenue moves into Recognized Revenue

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