REVENUE RECOGNITION |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| REVENUE RECOGNITION |
3.
REVENUE RECOGNITION
Substantially all of our revenues are considered to be revenues from contracts with students. We determine standalone selling price based on the price at which the distinct services or goods are sold separately. The related accounts receivable balances are recorded in our balance sheets as student accounts receivable. We do not have significant revenue recognized from performance obligations that were satisfied in prior periods, and we do not have any transaction price allocated to unsatisfied performance obligations other than in our unearned tuition. We record revenue for students who withdraw from our schools only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. In addition, to reduce the amount of outstanding accounts receivable balances due from our students, the Company employs a continuous collection effort. Unearned tuition represents contract liabilities primarily related to our tuition revenue. We have elected not to provide disclosure about transaction prices allocated to unsatisfied performance obligations if the original contract durations are less than one-year, or if we have the right to consideration from a student in an amount that corresponds directly with the value provided to the student for performance obligations completed to date in accordance with ASC Topic 606, Revenue from Contracts with Customers. We have assessed the costs incurred to obtain a contract with a student and determined them to be immaterial.
Unearned tuition
in the amount of $39.3 million and $44.2 million is recorded in the current
liabilities section of the accompanying Condensed Consolidated Balance Sheets
as of March 31, 2026, and December 31, 2025, respectively.
The change in this contract liability balance during the three months ended
March 31, 2026, is the result of payments received in advance of satisfying
performance obligations, offset by revenue
recognized during that period. Revenue recognized for the three months ended
March 31, 2026, that was included in the contract liability balance at the
beginning of the year was $38.8 million. The following table depicts the timing of revenue recognition:
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