Amounts that are anticipate to be refunded to clients shall be excluded from the transaction price. If cash is collected that is expected to be refunded, then the amount shall be accounted for as a refund liability. The estimate related to refunds, and the refund liability, should be updated at the end of each reporting period.
Note: In certain instances, the measurement of the refund liability maybe measured at a portfolio, rather than, contract level. In addition, there maybe an asset related to recognition of a refund liability (i.e., if a product is anticipated to be returned).
ASC 606 10-32-10 and ASC 606-10-55-22 thru ASC 606-10-55-29
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