(Revenue Recognition and Matching Principle) On June 5, 2003, McCoy Corporation signed a contract with Sulu Associates under which Sulu agreed (1) to construct an office building on land owned by McCoy, (2) to accept responsibility for procuring financing for the project and finding tenants, and (3) to manage the property for 35 years. The annual net income from the project, after debt service, was to be divided equally between McCoy Corporation and Sulu Associates. Sulu was to accept its share of future net income as full payment for its services in construction, obtaining finances and tenants, and management of the project.



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