Question

Which of the following is not an indicator that revenue for a service can be recognized over time?

The customer owns the asset as the seller is constructing it.
The customer consumes the benefit of the seller's work as it performed.
The asset being constructed has no alternative use to the seller, and the seller has the right to payment for progress to date even if the customer cancels the contract.
The seller has significant experience with the customer and anticipates fulfillment of the contract.

Answer 1

The indicator that revenue for a service cannot be recognized over time is when the customer owns the asset as the seller is constructing it.

Step-by-step explanation:

The indicator that revenue for a service cannot be recognized over time is when the customer owns the asset as the seller is constructing it. In this case, the revenue would be recognized at a specific point when the asset is completed. Examples of this could be a customer purchasing a house that is currently being built or a customer purchasing a car that is being assembled. The other indicators provided - the customer consuming the benefit of the seller's work as it is performed, the asset having no alternative use to the seller, and the seller having significant experience with the customer and anticipating fulfillment of the contract - all suggest that revenue can be recognized over time.