Final answer:
The final step in applying the core revenue recognition principle is to recognize revenue when the company fulfills a performance obligation by transferring control of goods or services to the customer, following a specific five-step model.
Step-by-step explanation:
The final step used to apply the core revenue recognition principle is to recognize revenue when (or as) the entity satisfies a performance obligation. This involves the transfer of control of the promised goods or services to the customer. According to the principle, revenue is recognized by the performance of the company proportional to the satisfaction of the performance obligation. The process typically involves a five-step model: identify the contract(s) with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) each performance obligation is satisfied.