the big picture case study

read the case details and ansewer the following questions:

The CEO of MV-Link Productions has hired your consulting firm to produce a report on this

possible breach of contract case, including recommendations. Use the report writing guide from

the course website. In your analysis of this case include answers to the following questions:

Assuming the contract is valid, prepare the following financial analyses:

.

b. What are the general revenue recognition criteria established under Generally

Accepted Accounting Principles (GAAP)

c. How would you apply the GAAP criteria for revenue recognition to account for the

revenues under this contract? Explain your logic for both realizable and earned.

d. Using the logic you developed in part c, calculate the revenue that MV-Link

Productions should report for the set of five films for the year ended 12/31/2006.

e. For the year ended 12/31/2006, prepare a schedule that shows the cash flows

received from PACE from the contract.

f. Why do cash flows and revenues recognized differ, if they differ under your

calculations?