commonly sells the supply and installation, and maintenance and services support in a combined goods and services contract. The combined goods and services contract sell for RM3,600, but if sold separately the supply and installation is sold for RM2,500 and the maintenance and services support for RM1,300 for a period of 24 months. Required:
Neo Air-conditioner Sdn Bhd primarily sells and installs air conditioner. As well as
supplies air conditioners, it also provides air conditioner repair and services to its
customers. The business commonly sells the supply and installation, and
maintenance and services support in a combined goods and services contract. The
combined goods and services contract sell for RM3,600, but if sold separately the
supply and installation is sold for RM2,500 and the maintenance and services
support for RM1,300 for a period of 24 months.
Required:
If Neo Air-conditioner sold a combined contract on 1 July 2022, demonstrate how the
transaction would be presented in the financial statements for the year ended 31
December 2022, using the five (5) steps revenue recognition model.
Please give calculation in details step by step.
Step by step
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