(Determining when to recognize revenue, LO 1, 2) For each of the following situations, use the four GAAP revenue-recognition criteria to determine when revenue should be recognized. Explain your reasoning.

a. A jewellery store offers a lay-away plan whereby a customer pays 10% of the purchase price of an item and the store holds the item until the customer has paid 60% of the selling price.

b. A professional hockey team sells season tickets to its fans. Fans pay the full price of the tickets before the season begins and receive tickets for the all of the team’s home games.

c. An auto parts manufacturer sells wheel assembly parts to a major car manufac-_ turer. The car manufacturer pays for the parts within 60 days of delivery. The manufacturer is entitled to return all parts that it decides are defective.

d. An electronics store sells customers extended warranties on the products that it sells. The extended warranty provides “free” parts and labour for three years beyond the one-year warranty that is provided by the manufacturer.