Sleep Country Canada Holdings Inc. is a specialty sleep retailer operating under the Sleep Country, Dormez-vous, and Endy banners. Exhibit 9.9 contains an extract from Note 3 detailing Sleep Country’s accounting policy related to customer deposits from the 2020 annual report.

Required
Refer to the extract from in your own words explain why Sleep Country reports customer deposits as a current liability and how this liability is discharged.

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(in thousands of Canadian dollars, except earnings per share) Customer deposits Customer deposits represent amounts paid by customers in advance of delivery of product (e.g., mattresses). These deposits can be for all or a portion of the total purchase price of the product. The amounts received representing the customer deposit are unencumbered and can be used for general operating purposes. Once the product is delivered to the customer, therefore fulfilling the performance obligation, the liability is relieved and is recorded in revenue. Over time, some portion of the customer deposits is not redeemed (breakage). The expected breakage amount based on historical actuals are recognized as revenue in proportion to the redemption pattern exercised by the customers.