They booked all $1M of the up front fee as deferred revenue and the opposite side of the transaction was $1M increase in accounts receivable. Subsequently, they received $500K cash - the first half of the fee that they told us they received in March. This increased cash by $500K and lowered AR to $500K. It's all there; nothing is hidden.
Deferred Revenue is a Liability. Accounts Receivable is an Asset. That's not double counting because they are on opposite sides of the balance sheets. It's a debit to the asset and a credit to the liability. It's exactly how you book it.
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