# ASC 330-978: Inventory — Real Estate—Time-Sharing Activities Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/330/978/) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-09T23:53:35.942Z to 2026-09-09T23:53:56.981Z Record version: sha256:079b1a54bdb9c9efc46e9b9839886b42f720908a27ad6fdf9cfaa1f33994f318 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978: Inventory — Real Estate—Time-Sharing Activities ### Machine-generated study aids ```json { "summary": "ASC 330-978 governs how time-share sellers measure time-sharing inventory (intervals) and cost of sales. Sellers must use the relative sales value method, applied phase by phase, with common costs (including amenities) allocated among benefited phases, and must recalculate total estimated time-sharing revenue and total costs at least quarterly. Changes in estimate are recorded as current-period adjustments, and rental/other activity during the holding period is treated as incidental operations that reduce the pool of inventory costs.", "key_points": [ "Sellers of time-sharing intervals account for cost of sales and inventory using the relative sales value method, applied separately to each phase, with common costs such as amenities allocated among the phases they benefit (330-978-30-1).", "At least quarterly—even if no quarterly SEC reports are filed—total time-sharing revenue (actual to-date plus expected future) and total cost estimates must be recalculated, incorporating uncollectibles, price/mix changes, repossessions, upgrade programs, and sales incentives; the cost-of-sales percentage is recomputed each time (330-978-35-1).", "Effects of changes in estimate are accounted for as a current-period adjustment so that the ending balance sheet and subsequent accounting are as if the revised estimates had been the original ones, with disclosure under 250-10-50-4 (330-978-35-1).", "An adjustment for expected uncollectibles carries a corresponding adjustment to cost of sales and inventory via the cost-of-sales percentage; repossession or reacquisition of an interval has no inventory effect unless it changes expected uncollectibles (330-978-35-2).", "Inventory must still be tested for impairment under 360-10-35-38 through 35-40, 360-10-35-43, and 360-10-40-5 (330-978-35-2).", "Rental and other operations during holding periods are incidental operations: incremental revenue exceeding incremental cost reduces the pool of inventory costs (and is not projected into the relative sales value calculation), while incremental cost exceeding revenue is expensed as incurred (330-978-35-3).", "During holding periods—beginning when intervals are held for and available for sale (e.g., legally registered as time-shares)—intervals are inventory and are not depreciated; rental activity outside the holding period requires depreciation and lessor accounting under Subtopic 842-30 (330-978-35-4 through 35-6)." ], "categories": [ "Subsequent measurement", "Inventory and PP&E", "Industry-specific", "Impairment" ], "audience_level": "advanced", "student_note": "This is a niche, industry-specific measurement model: the relative sales value method links inventory relief directly to revenue estimates, so a change in expected uncollectibles automatically changes cost of sales and inventory. A common misunderstanding is thinking a repossessed interval goes back into inventory—it does not, unless the repossession changes the estimate of uncollectibles.", "related_topics": [ "978-330", "978-810", "606-10", "360-10", "250-10", "842-30" ], "key_concepts": [ "relative sales value method", "time-sharing interval", "cost-of-sales percentage", "incidental operations", "holding period", "change in estimate", "expected uncollectibles", "inventory impairment" ] } ``` Source downloaded (UTC): 2026-09-09T23:53:35.942Z to 2026-09-09T23:53:35.942Z Record version: sha256:e76ae7891bb86ffcaef83599a3c6d1dee932ba3f28b58bd753035ce38d3ab58f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/330/978/#00-status) SEC content: no ##### [330-978-00-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-00-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:35.942Z to 2026-09-09T23:53:35.942Z Record version: sha256:2f28356cc790deb938b7dafedc6903398a1481e07758e878ff31a6b3259ff3ff Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
ContractAddedAccounting Standards Update No. 2014-0905/28/2014
CustomerAddedAccounting Standards Update No. 2014-0905/28/2014
Deposit MethodSupersededAccounting Standards Update No. 2014-0905/28/2014
Incremental Costs from Incidental OperationsAddedAccounting Standards Update No. 2014-0905/28/2014
Incremental Revenue from Incidental OperationsAddedAccounting Standards Update No. 2014-0905/28/2014
Mini-VacationAddedAccounting Standards Update No. 2014-0905/28/2014
Phase (2nd def.)AmendedAccounting Standards Update No. 2014-0603/14/2014
RevenueAddedAccounting Standards Update No. 2014-0905/28/2014
Time-SharingAmendedAccounting Standards Update No. 2014-0603/14/2014
Sampler ProgramAddedAccounting Standards Update No. 2014-0905/28/2014
Undivided Interest (2nd def.)SupersededAccounting Standards Update No. 2014-0603/14/2014
978-330-15-3AmendedAccounting Standards Update No. 2014-0905/28/2014
978-330-15-4AmendedAccounting Standards Update No. 2014-0905/28/2014
978-330-30-1AmendedAccounting Standards Update No. 2014-0905/28/2014
978-330-30-2SupersededAccounting Standards Update No. 2014-0905/28/2014
978-330-30-3AmendedAccounting Standards Update No. 2014-0905/28/2014
978-330-35-1 through 35-4
AmendedAccounting Standards Update No. 2014-0905/28/2014
978-330-35-6AmendedAccounting Standards Update No. 2016-0202/25/2016
Source downloaded (UTC): 2026-09-09T23:53:39.402Z to 2026-09-09T23:53:39.402Z Record version: sha256:425ef4ddeed47bbd416154a493e396b8637ae8c0293357a3550c65e07a246bb5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/978/#05-overview-and-background) SEC content: no ##### [330-978-05-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:39.402Z to 2026-09-09T23:53:39.402Z Record version: sha256:64334e2a978488e66cf7f5b4f374880d1901efd2c3737c9b7cb39b3df429f0d0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic addresses real estate [time-sharing](https://asc.understandingaccounting.org/glossary/t/#time-sharing "An arrangement in which a seller sells or conveys the right to occupy a dwelling unit for specified periods in the future. Forms of time-sharing arrangements include but are not limited to fixed and floating time, interval ownership, undivided interests, points programs, vacation clubs, right-to-use arrangements such as tenancy-for-years arrangements, and arrangements involving special-purpose entities. In this context, an undivided interest is a time-sharing arrangement that involves a tenant-in-common interest in a condominium unit or entire improved property, and in which the interest holder is assigned a specific period (generally, a specific week). The interest holder is also assigned a specific unit if the undivided interest is in the entire improved property.") inventory measurement issues. Time-sharing inventory consists of [time-sharing interests](https://asc.understandingaccounting.org/glossary/t/#time-sharing-interest "See Interval.") or [intervals](https://asc.understandingaccounting.org/glossary/i/#interval "The specific period (generally, a specific week) during the year that a time-sharing unit is specified by agreement to be available for occupancy by a particular customer. Also denoted Time-Sharing Interest or Time-Share."). Source downloaded (UTC): 2026-09-09T23:53:41.579Z to 2026-09-09T23:53:41.579Z Record version: sha256:c7d2086c12ee7dae11de7a72f331991e0bd4c2486c55e1748c169fc165700663 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/978/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-978-15-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:41.579Z to 2026-09-09T23:53:41.579Z Record version: sha256:28f8b6f918de02fc224394ca2eb43e1490844268012e94462717e5a35f70e08d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 978-10-15, with specific transaction exceptions noted below. ##### [330-978-15-2](https://asc.understandingaccounting.org/asc/330/978/#330-978-15-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:41.579Z to 2026-09-09T23:53:41.579Z Record version: sha256:5e42eaf65d157ea097ed20b5862d3bcdd7c4072b6a67375cdc4c8e11769afc53 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [978-810-25-3](https://asc.understandingaccounting.org/asc/810/978/#810-978-25-3) for guidance concerning when an entity shall recognize its interests in a [special-purpose entity](https://asc.understandingaccounting.org/glossary/s/#time-sharing-special-purpose-entity "An entity, typically a corporation or a trust, to which a seller transfers time-sharing real estate in exchange for the entity's stock, membership interests, or beneficial interests.") as inventory. #### Transactions ##### [330-978-15-3](https://asc.understandingaccounting.org/asc/330/978/#330-978-15-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:41.579Z to 2026-09-09T23:53:41.579Z Record version: sha256:50c4e5ff439e5e1ed166316db592a2f09d7749c1a8fc95780df4442ffee296a3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic applies to the following transactions and activities: 1. a All [time-sharing](https://asc.understandingaccounting.org/glossary/t/#time-sharing "An arrangement in which a seller sells or conveys the right to occupy a dwelling unit for specified periods in the future. Forms of time-sharing arrangements include but are not limited to fixed and floating time, interval ownership, undivided interests, points programs, vacation clubs, right-to-use arrangements such as tenancy-for-years arrangements, and arrangements involving special-purpose entities. In this context, an undivided interest is a time-sharing arrangement that involves a tenant-in-common interest in a condominium unit or entire improved property, and in which the interest holder is assigned a specific period (generally, a specific week). The interest holder is also assigned a specific unit if the undivided interest is in the entire improved property.") sale transactions that are within the scope of Topic 606 on [revenue](https://asc.understandingaccounting.org/glossary/r/#revenue "Inflows or other enhancements of assets of an entity or settlements of its liabilities (or a combination of both) from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing major or central operations.") from [contracts](https://asc.understandingaccounting.org/glossary/c/#contract "An agreement between two or more parties that creates enforceable rights and obligations.") with [customers](https://asc.understandingaccounting.org/glossary/c/#customer "A party that has contracted with an entity to obtain goods or services that are an output of the entity's ordinary activities in exchange for consideration."). ##### [330-978-15-4](https://asc.understandingaccounting.org/asc/330/978/#330-978-15-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:41.579Z to 2026-09-09T23:53:41.579Z Record version: sha256:212a59dd1b0fb498e6a712f6c94e985465b15153ffd0401c8ce67c85c5dd9e4e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic does not apply to the following transactions and activities: 1. a Time-sharing transactions transactions that fail to meet all of the criteria in paragraph [606-10-25-1](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-1) and, therefore, are accounted for in accordance with paragraphs [606-10-25-6 through 25-8](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-6) . Source downloaded (UTC): 2026-09-09T23:53:47.501Z to 2026-09-09T23:53:47.501Z Record version: sha256:f6aa8bdcb470fafcd43fef5deb278fedbc7c189ae05d184df502103ff27549c6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-30: 30 Initial Measurement [Read section](https://asc.understandingaccounting.org/asc/330/978/#30-initial-measurement) SEC content: no #### Accounting for Cost of Sales and Time-Sharing Inventory ##### [330-978-30-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-30-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:47.501Z to 2026-09-09T23:53:47.501Z Record version: sha256:2ffa67a7d3c4df84713266d4be5c80b18c48b07d5783b56e2754eb516656605d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Sellers of [time-sharing](https://asc.understandingaccounting.org/glossary/t/#time-sharing "An arrangement in which a seller sells or conveys the right to occupy a dwelling unit for specified periods in the future. Forms of time-sharing arrangements include but are not limited to fixed and floating time, interval ownership, undivided interests, points programs, vacation clubs, right-to-use arrangements such as tenancy-for-years arrangements, and arrangements involving special-purpose entities. In this context, an undivided interest is a time-sharing arrangement that involves a tenant-in-common interest in a condominium unit or entire improved property, and in which the interest holder is assigned a specific period (generally, a specific week). The interest holder is also assigned a specific unit if the undivided interest is in the entire improved property.") intervals shall account for cost of sales and time-sharing inventory using the [relative sales value method](https://asc.understandingaccounting.org/glossary/r/#relative-sales-value-method "The relative sales value method is similar to a gross profit method and is used to allocate inventory cost and determine cost of sales in conjunction with a sale. Under the relative sales value method, cost of sales is calculated as a percentage of net sales using a cost-of-sales percentage—the ratio of total estimated cost (including costs to complete, if any) to total estimated time-sharing revenue. Time-sharing revenue is calculated as total expected future revenue adjusted for total expected future bad-debt expense."). The relative sales value method shall be applied to each [phase](https://asc.understandingaccounting.org/glossary/p/#phase "A contractually or physically distinguishable portion of a real estate project (including time-sharing projects). That portion is distinguishable from other portions based on shared characteristics such as: Units a developer has declared or legally registered to be for sale Units linked to an owners association Units to be constructed during a particular time period How a developer plans to build the real estate project.") separately. [Common costs](https://asc.understandingaccounting.org/glossary/c/#common-costs "Costs that relate to two or more units or phases within a real estate or time-sharing project."), including [amenities](https://asc.understandingaccounting.org/glossary/a/#amenities "Features that enhance the attractiveness or perceived value of a time-sharing interval. Examples of amenities include golf courses, utility plants, clubhouses, swimming pools, tennis courts, indoor recreational facilities, and parking facilities. See also Promised Amenities."), shall be allocated to inventory among the phases that those costs will benefit. ##### [330-978-30-2](https://asc.understandingaccounting.org/asc/330/978/#330-978-30-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:47.501Z to 2026-09-09T23:53:47.501Z Record version: sha256:d1883a9a7c87420e4721eab2d97960e35be628ab470bc464fabd00aac5234837 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2014-09](https://asc.understandingaccounting.org/updates/asu-2014-09/). ##### [330-978-30-3](https://asc.understandingaccounting.org/asc/330/978/#330-978-30-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:47.501Z to 2026-09-09T23:53:47.501Z Record version: sha256:fb3bfc4fac30fe02867a3a7fff83b2a87e0eca5c1327bafc978bb28460d5dcec Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [978-330-35-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-1) for additional guidance related to the determination of total time-sharing revenue and total cost estimates. Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:e999298da762f0115e529ec461e6c30f4bea00d7813302f505a505959656dac5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/330/978/#35-subsequent-measurement) SEC content: no #### Accounting for Cost of Sales and Time-Sharing Inventory ##### [330-978-35-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:93c00dd3a546348564b2b0155c0fbaac8f5401e3a7a913351354f568aac3e1e6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. At least quarterly, both total [time-sharing](https://asc.understandingaccounting.org/glossary/t/#time-sharing "An arrangement in which a seller sells or conveys the right to occupy a dwelling unit for specified periods in the future. Forms of time-sharing arrangements include but are not limited to fixed and floating time, interval ownership, undivided interests, points programs, vacation clubs, right-to-use arrangements such as tenancy-for-years arrangements, and arrangements involving special-purpose entities. In this context, an undivided interest is a time-sharing arrangement that involves a tenant-in-common interest in a condominium unit or entire improved property, and in which the interest holder is assigned a specific period (generally, a specific week). The interest holder is also assigned a specific unit if the undivided interest is in the entire improved property.") revenue (actual to-date plus expected future revenue) and total cost estimates shall be recalculated. A time-sharing entity shall adjust at least quarterly even if it does not issue quarterly financial reports under Securities and Exchange Commission (SEC) reporting requirements. The estimate of total time-sharing revenue (actual to-date plus expected future revenue) for use in the [relative sales value method](https://asc.understandingaccounting.org/glossary/r/#relative-sales-value-method "The relative sales value method is similar to a gross profit method and is used to allocate inventory cost and determine cost of sales in conjunction with a sale. Under the relative sales value method, cost of sales is calculated as a percentage of net sales using a cost-of-sales percentage—the ratio of total estimated cost (including costs to complete, if any) to total estimated time-sharing revenue. Time-sharing revenue is calculated as total expected future revenue adjusted for total expected future bad-debt expense.") shall incorporate factors such as incurred or estimated uncollectibles, changes in sales prices or sales mix, repossession of intervals that the seller may or may not be able to resell, effects of [upgrade](https://asc.understandingaccounting.org/glossary/u/#upgrade "A time-sharing transaction whereby a customer relinquishes the right to a currently held time-sharing interval and obtains a higher-priced time-sharing interval from the same seller.") programs, and past or expected sales incentives to sell slow-moving inventory units. Such amounts should be included in the estimate of total time-sharing revenue for use in the relative sales value method even when those amounts are recognized as bad-debt expense within the statement of comprehensive income rather than included within the revenue recognized. The cost-of-sales percentage shall be similarly recalculated each time estimated revenue (including amounts reported or expected to be reported as revenue or as bad-debt expense) or cost is adjusted, using the new estimate of total time-sharing revenue and total cost (including costs to complete, if any). The effects of changes in estimate for cost shall be accounted for in each period using a current-period adjustment, that is, the [time-share](https://asc.understandingaccounting.org/glossary/t/#time-share "See Interval.") seller shall account for a change in estimate in the period of change so that the balance sheet at the end of the period of change and the accounting in subsequent periods are as they would have been if the revised estimates had been the original estimates. The effects of changes in estimate shall be disclosed in accordance with paragraph [250-10-50-4](https://asc.understandingaccounting.org/asc/250/10/#250-10-50-4). The inventory balance reported in the balance sheet, plus estimated costs to complete that inventory, if any, represents a pool of costs that will be charged against future revenue. ##### [330-978-35-2](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:5e72b0a175b95992a3c7a41b5b09f509ec6d53b98ef6200e6ce44b92aad28bbe Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The recording of an adjustment for expected uncollectibles is accompanied by a corresponding adjustment to cost of sales and inventory that is effected through the application of the cost-of-sales percentage. However, under the relative sales value method, there is no accounting effect on inventory if a time-sharing [interval](https://asc.understandingaccounting.org/glossary/i/#interval "The specific period (generally, a specific week) during the year that a time-sharing unit is specified by agreement to be available for occupancy by a particular customer. Also denoted Time-Sharing Interest or Time-Share.") is repossessed or otherwise reacquired unless the repossession causes a change in expected uncollectibles. The seller shall, however, perform impairment testing on its inventory in accordance with paragraphs [360-10-35-38 through 35-40](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-38) , [360-10-35-43](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-43), and [360-10-40-5](https://asc.understandingaccounting.org/asc/360/10/#360-10-40-5). ##### [330-978-35-3](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:46b67542b04959f09fce6a1c21f57631830d0c958688fbdf2a93fd79fd9f2941 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Revenue from and costs of rental and other operations during holding periods shall be accounted for as [incidental operations](https://asc.understandingaccounting.org/glossary/i/#incidental-operations "Revenue-producing activities engaged in during the holding or development period to reduce the cost of developing the property for its intended use, as distinguished from activities designed to generate a profit or a return from the use of the property."). [Incremental revenue from incidental operations](https://asc.understandingaccounting.org/glossary/i/#incremental-revenues-from-incidental-operations "Revenues that would not be produced except in relation to the conduct of incidental operations.") in excess of [incremental costs from incidental operations](https://asc.understandingaccounting.org/glossary/i/#incremental-costs-of-incidental-operations "Costs that would not be incurred except in relation to the conduct of incidental operations. Interest, taxes, insurance, security, and similar costs that would be incurred during the development of a real estate project regardless of whether incidental operations were conducted are not incremental costs.") shall be accounted for as a reduction of inventory costs—that is, the pool of inventory costs under the relative sales value method as described in paragraph [978-330-35-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-1). Estimates of future amounts of such excess should not be factored into the calculations of the relative sales value method. Incremental costs in excess of incremental revenue should be charged to expense as incurred. #### Operations during Holding Periods ##### [330-978-35-4](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:70d2ae59762715d784f5916b92a9fed1ea9826a5b90890a89c9a49f60ee6e756 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Holding period](https://asc.understandingaccounting.org/glossary/h/#holding-period "The period during which a time-sharing interval is held for sale. Sellers may offer time-sharing units for rent during such holding periods.") operations include [sampler programs](https://asc.understandingaccounting.org/glossary/s/#sampler-program "A marketing program under which a time-share developer offers a customer, who has previously toured one of the developer's projects, a stay at one of the projects at a reduced rate. In exchange, the customer agrees to take another, subsequent tour of the project selected under the sampler program during the customer's stay at that project. If the subsequent tour results in a sale, the developer may allow the customer to apply some or all of the amount paid for the sampler toward the purchase of a time-share, as a part of the down payment. Also referred to as Exit Program.") and [mini-vacations](https://asc.understandingaccounting.org/glossary/m/#mini-vacation "A marketing program under which a time-share developer offers, for a fee, a short (typically, two to three days) visit to a destination where the developer operates a project. The developer typically subsidizes the fee to the customer for the mini-vacation in exchange for the customer attending a sales presentation at the project. The mini-vacation may include room accommodations, entertainment tickets, and similar items of value. The customer typically accepts the offer of the fee subsidy in exchange for his or her attending the sales presentation."). During holding periods, time-sharing intervals shall be accounted for as inventory and shall not be depreciated. Costs of operations during holding periods include seller subsidies and maintenance and related costs on time-sharing intervals held for sale. ##### [330-978-35-5](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:0ae0826a861ca4d89fce19b7075c42da56a0f1eb9e8894eb3dec0a4de528fab8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For time-sharing operations, the holding period (as that term is used in the definition of [incidental operations](https://asc.understandingaccounting.org/glossary/i/#incidental-operations "Revenue-producing activities engaged in during the holding or development period to reduce the cost of developing the property for its intended use, as distinguished from activities designed to generate a profit or a return from the use of the property.")) begins at the time that intervals are held for and are available for sale—for example, when units in domestic locations are legally registered for sale as time-shares. A seller shall evaluate each period as to whether units previously considered held for and available for sale shall continue to be characterized as such. ##### [330-978-35-6](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:15d29a8dff1e3b6ca4314c8d48e7dd47eb26e1f08de1c27765c44bee48277fe5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If rental activities occur other than during the holding period, the corresponding units shall be depreciated and those activities shall be accounted for as rental operations in accordance with Subtopic 842-30 on leases—lessors. Source downloaded (UTC): 2026-09-09T23:53:53.503Z to 2026-09-09T23:53:53.503Z Record version: sha256:a98747a13fc2947f8564a3b57793183bc40ae782615c9b8fa4b886b9278e4a6f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/330/978/#50-disclosure) SEC content: no ##### [330-978-50-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-50-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:53.503Z to 2026-09-09T23:53:53.503Z Record version: sha256:be6b9f4a08043b89350e26f0732d1e576354acfebd7063faaffd34d5c23f8e89 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [978-330-35-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-1) for disclosure requirements for changes in estimates used to perform the [relative sales value method](https://asc.understandingaccounting.org/glossary/r/#relative-sales-value-method "The relative sales value method is similar to a gross profit method and is used to allocate inventory cost and determine cost of sales in conjunction with a sale. Under the relative sales value method, cost of sales is calculated as a percentage of net sales using a cost-of-sales percentage—the ratio of total estimated cost (including costs to complete, if any) to total estimated time-sharing revenue. Time-sharing revenue is calculated as total expected future revenue adjusted for total expected future bad-debt expense.").