Sonny Boy Company plans to buy 20 units of flat screen, 60 inches TV set from Sony Philippines. The cash price is P25,000 per unit. Since Sonny Boy Company has no enough cash to pay the units upon delivery, it offers to pay in terms: 50% upon delivery and 50% 12 months after. Sony Philippines is amenable to the terms only if Sonny Boy Company accepts increased purchase price of P27,500. Sonny Boy accepts the condition and both parties also agreed on the right of returns within 90 days from date of delivery. The cost of one TV set is P18,000. All the 20 units were delivered by Sony and received the 50% partial payment. 2. Under IFRS 15, how much revenue from sales is recognized by Sony Philippines on the date of sale? P500,000 P550,000 a. с. P275,000 b. d. No revenue is recognized

Sonny Boy Company plans to buy 20 units of flat screen, 60 inches TV set from Sony Philippines. The cash price is P25,000 per unit. Since Sonny Boy Company has no enough cash to pay the units upon delivery, it offers to pay in terms: 50% upon delivery and 50% 12 months after. Sony Philippines is amenable to the terms only if Sonny Boy Company accepts increased purchase price of P27,500. Sonny Boy accepts the condition and both parties also agreed on the right of returns within 90 days from date of delivery. The cost of one TV set is P18,000. All the 20 units were delivered by Sony and received the 50% partial payment. 2. Under IFRS 15, how much revenue from sales is recognized by Sony Philippines on the date of sale? P500,000 P550,000 a. с. P275,000 b. d. No revenue is recognized

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Exchange Rate Risk

It is the possibility that the value of a currency will fluctuate in the future. In the wake of globalization, business establishments have increasingly ventured into international markets. The volume of international trade has prospered excellently in the near past and is expected to be more affluent in the future. The use of exchange-traded derivative financial instruments has been multi-folded to provide for the requirements of various MNCs and offshore potential investors. Most banks and financial institutions have helped integrate the global economies. Our Government has introduced some bold and extreme measures to fulfil the purpose behind the fiscal, industrial, and monetary policies. The enactment of GST is a huge step towards streamlining the taxation system of the country. Owing to Covid-19, this aspect of corporate risk management has become critical.

Question

100%

Sonny Boy Company plans to buy 20 units of flat screen, 60 inches TV set from
Sony Philippines. The cash price is P25,000 per unit. Since Sonny Boy Company
has no enough cash to pay the units upon delivery, it offers to pay in terms: 50%
upon delivery and 50% 12 months after. Sony Philippines is amenable to the terms
only if Sonny Boy Company accepts increased purchase price of P27,500. Sonny
Boy accepts the condition and both parties also agreed on the right of returns
within 90 days from date of delivery. The cost of one TV set is P18,000. All the 20
units were delivered by Sony and received the 50% partial payment.
2. Under IFRS 15, how much revenue from sales is recognized by Sony Philippines
on the date of sale?
P500,000
P550,000
а.
с.
P275,000
b.
d.
No revenue is recognized

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