Using revenue recognition

Selling subscription contracts is one of the possible ways of selling services with the Odoo subscription application. Consider the kind of business where advance payment is received from the customer against the subscription contract. It is a liability and not an actual sale. This customer advance is registered as a deferred revenue instead of being registered as a sale. Every month, liability will decrease and income will be incurred from the advance received. This accounting mechanism is called revenue recognition.

Let's see how we can set up the revenue recognition in Odoo without using subscription application.

How to do it...

1. To enable the Revenue Recognition feature for the accounting application, go to Configuration | Settings. Search for Revenue Recognition and select it. Then, click on APPLY to activate the feature.
2. The next step is to create a deferred revenue type by going to Configuration | Management | Deferred Revenue Type. Deferred Revenue Type has to...