Able Company enters into a contract with a customer to provide them with an accounts receivable program. Able will also provide installation services as part of the contract. Able will make sure that this program will be installed so that it will be customized and be able to integrate with the company's other program modules. What is the number of performance obligations for this contract

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Business

Nikolai Rubio

24 March, 23:14

Able Company enters into a contract with a customer to provide them with an accounts receivable program. Able will also provide installation services as part of the contract. Able will make sure that this program will be installed so that it will be customized and be able to integrate with the company's other program modules. What is the number of performance obligations for this contract

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Steve Hodge · Answer 1

One

Explanation:

Installation of the program is the single performance obligation because there nothing more than this obligation the Able company is providing them. If they were providing this facility to the customer's subsidiary as well then the performance obligation would be 2 because the two companies were here to given product access by installation. So in the given scenario there is only one performance obligation.