Using the contract-based approach, revenue is recognized for the sale of goods when the following conditions have been met: A. the seller no longer has control over the goods. B. all of these conditions are met. C. delivery of goods has occurred, consistent with terms of a real or implied contract, and any related performance obligation has been completed. D. the amount of revenue and costs can be reliably measured and it is probable the cash will be collected. Please explain for the answer, and why the rest is incorrect.
Multiple-Choice Question:
1. Using the contract-based approach, revenue is recognized for the sale of goods when the following conditions have been met:
A. the seller no longer has control over the goods.
B. all of these conditions are met.
C. delivery of goods has occurred, consistent with terms of a real or implied contract, and any related performance obligation has been completed.
D. the amount of revenue and costs can be reliably measured and it is probable the cash will be collected.
Please explain for the answer, and why the rest is incorrect.
According to the IFRS criteria, for revenue to be recognized, the following conditions must be satisfied:
a) Risks and rewards of ownership have been transferred from the seller to the buyer.
b) The amount of revenue can be reasonably measured.
c) The collection of payments from goods or services is reasonably assured.
d) Costs of revenue can be reasonably measured.
E) The seller does not have control any longer over the goods sold.
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