The primary objective of this case is the development of an understanding of the revenue recognition criteria and the complications that develop given alternative variations in the same product. This case uses the casino environment to define the initial critical event for revenue recognition (slot revenues). The case expands on the basic revenue recognition criteria with the application of the matching concept. That is, what costs (slot jackpots, unpaid winning tickets, etc.) must be recognized given the recognition of revenue. Additional complexities to revenue recognition are added that cover the issues of defining gross versus net revenues (participation agreements with vendors, players’ loyalty clubs, and special promotions).


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