Question

Revenue is typically recognized _____ for a license that provides the customer with the right of access to the seller's intellectual property.

a) Over time
b) At a specific point in time
c) Upon customer request
d) Upon delivery of the license

Answer 1

a) Over time

Revenue for a license granting access to intellectual property is typically recognized over time, as the customer benefits across the license term. A patent, which is a form of intellectual property, is usually protected for 20 years to encourage innovation and allow for potential monopoly profits.

Step-by-step explanation:

Revenue is typically recognized over time for a license that provides the customer with the right of access to the seller's intellectual property.

This reflects the way the customer gains and benefits from the access to the intellectual property throughout the duration of the license term. Generally, a patent is a form of intellectual property right that gives the inventor the exclusive legal right to make, use, or sell their invention for a limited time.

In many jurisdictions, the standard patent protection period is 20 years from the filing date, which is intended to provide an incentive for innovation by allowing the inventor to potentially earn monopoly profits during this time frame.