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Question:.Essay 9: Revenue Recognition – The New Standard Revenue is recognized based on a five-step process that is applied to a company’s revenue arrangements.Requirements:1. Describe the revenue recognition principle. Briefly describe the five-step process.2. Explain the importance of contracts when analyzing revenue arrangements.3. How are fair value measurement concepts applied in implementation of the five-step process?4. Briefly discuss how the revenue recognition principle relates to the definitions of assets and liabilities.5. In the previous revenue recognition guidance, revenue is not be recognized unless the revenue was realized or realizable (also referred to as collectibility). Is collectibility a consideration in the recognition of revenue? Explain.6. Revenue is usually recognized at the point of sale (a point in time). Revenue may be also recognized over time. Give an example of the circumstances in which revenue is recognized over time and accounting merits of its use instead of the point-of-sale basis.