Fasb Case

3. Recognize the transaction price. The transaction price mostly refers to the amount of consideration that an entity expects to receive from the customers or contract. It includes the estimate of consideration with the following variables, such as rebates and bonus, that by using a “probability-weighted” measure on the expected transaction price, the amount can be identified. It is affected by the time-value of money and non-cash consideration in order measure the fair amount of the transaction price. In the cases of sales and royalties that are specified in the intellectual property license, the new guideline prescribes that an entity will exclude such transaction prior to the sale or their usage (“IASB and FASB issue new” 3).
4. Proportion