Does the entity's ability and intent to sue if the customer terminates the contract indicate that ithas an enforceable right to payment?
The entity's ability and intent to sue if a customer terminates the contract does not necessarily establish an enforceable right to payment as per ASC 606-10-55-13. The key factor is whether the contract grants the entity a legally enforceable right to consideration in exchange for goods or services it has transferred to the customer. The entity should evaluate the contract terms to determine if it has this right, independent of its ability or willingness to pursue legal action.
