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We run a B2C home-based services business. We repair and service used appliances. We offer service and/or maintenance agreements on used refurbished appliances we sell and/or appliances we have repaired in the home. These service and maintenance agreements are a significant percentage of our annual revenue.
Our accountant we must now realize service maintenance agreements revenue incrementally. If we sell a one year service agreement, we must break out the fee (paid @ start of agreement) on a 1/12 basis (each month) thus incrementally applying the full fee to the agreement.