read the case details and ansewer the following questions:
The CEO of MV-Link Productions has hired your consulting firm to produce a report on this
possible breach of contract case, including recommendations. Use the report writing guide from
the course website. In your analysis of this case include answers to the following questions:
Assuming the contract is valid, prepare the following financial analyses:
a. Prepare a budget of expected minimum revenues under the contract. Show the
sources of revenues from the set of five films and the fee.
b. What are the general revenue recognition criteria established under Generally
Accepted Accounting Principles (GAAP)
c. How would you apply the GAAP criteria for revenue recognition to account for the
revenues under this contract? Explain your logic for both realizable and earned.
d. Using the logic you developed in part c, calculate the revenue that MV-Link
Productions should report for the set of five films for the year ended 12/31/2006.
e. For the year ended 12/31/2006, prepare a schedule that shows the cash flows
received from PACE from the contract.
f. Why do cash flows and revenues recognized differ, if they differ under your