USA Contract Fees at Termination


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I have an operating agreement with a company which toll manufactures for me which calls for a lump sum payment ($100K) upon termination. It is not an early termination fee but merely intended to assist with employee costs and building rehab after I cease business with the company. I gave a one year notice this month so the fee is payable upon exit in one year. When do I recognize the expense?
 
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kirby

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SFAS 146 says you recognize the expense now and record it at the present value today of the $100k. Then monthly record the difference between the $100k and the pv using an amortization method
 

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