Read the assigned case and complete an analysis of the case. In addition to responses to the case questions, your write up should include a summary of the case, company background, and industry overview.

1. Which of EOSs revenue recognition practices (2018 vs 2019) better reflects economic reality?

2. Which method is more congruent with the IFRS?

3. Which method is more congruent with industry practice/competitors?

4. Which factor has greater impact on Q1 2019 equipment sales the change in revenue recognition methods, or the declining order numbers?

5. Using Zhous estimate of the order and installation schedule, calculate the 2017-2019 equipment sales revenue: a) under the old practice, b) under the new practice. Is the change in revenue permanent or temporary?

6. Should Zhou recommend her supervisor to liquidate her stake in EOS?