Quarterly report pursuant to Section 13 or 15(d)

Note 1 - Summary of Significant Accounting Policies: Revenue Recognition (Policies)

v3.10.0.1
Note 1 - Summary of Significant Accounting Policies: Revenue Recognition (Policies)
9 Months Ended
Sep. 30, 2018
Policies  
Revenue Recognition

Revenue Recognition - We account for product revenue in accordance with Accounting Standards Codification 606, Revenue Recognition, and all related interpretations.  Revenue is recognized when the following criteria are met:

 

·         Identification of the contract, or contracts, with a customer

·         Identification of the performance obligations in the contract 

·         Determination of the transaction price

·         Allocation of the transaction price to the performance obligations in the contract 

·         Recognition of revenue when, or as, we satisfy performance obligation

 

Revenue generally is recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities.

 

Revenue recognition for multiple-element arrangements requires judgment to determine if multiple elements exist, whether elements can be accounted for as separate units of accounting, and if so, the fair value for each of the elements.

 

The Company may enter into arrangements that can include various combinations of software, services, and hardware. Where elements are delivered over different periods of time, and when allowed under U.S. GAAP, revenue is allocated to the respective elements based on their relative selling prices at the inception of the arrangement, and revenue is recognized as each element is delivered. We use a hierarchy to determine the fair value to be used for allocating revenue to elements: (i) vendor-specific objective evidence of fair value ("VSOE"), (ii) third-party evidence, and (iii) best estimate of selling price ("ESP"). For software elements, we follow the industry specific software guidance which only allows for the use of VSOE in establishing fair value. Generally, VSOE is the price charged when the deliverable is sold separately, or the price established by management for a product that is not yet sold if it is probable that the price will not change before introduction into the marketplace. ESPs are established as best estimates of what the selling prices would be if the deliverables were sold regularly on a stand-alone basis. Our process for determining ESPs requires judgment and considers multiple factors that may vary over time depending upon the unique facts and circumstances related to each deliverable.

 

Any revenue received that does not yet meet the above recognition standards is recorded to unearned revenue and held as a liability until recognition occurs.