International Financial Reporting Standards They are commonly known as IFRS. These are set of accounting standards which are developed by independent (Non-profit) organization called as International Accounting Standards Board (IASB). These are universally accepted set of standards which state the rules and standards for accounting at global level. Revenue recognized point of long term contract A long-term contract qualifies for revenue recognition over time. The seller can recognize the revenue as per percentage of the completion of the project, which is recognized as revenue minus cost of completion until date. If a contract does not meet the performance obligation norm, then the seller cannot recognize the revenue till the project is complete. To indicate: The method of revenue recognition which is used by the Company TK for long-term construction contracts.

Question

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Answer 1

Question

Chapter 5, Problem 5.16BYP

Requirement – 1

To determine

International Financial Reporting Standards

They are commonly known as IFRS. These are set of accounting standards which are developed by independent (Non-profit) organization called as International Accounting Standards Board (IASB). These are universally accepted set of standards which state the rules and standards for accounting at global level.

Revenue recognized point of long term contract

A long-term contract qualifies for revenue recognition over time. The seller can recognize the revenue as per percentage of the completion of the project, which is recognized as revenue minus cost of completion until date.

If a contract does not meet the performance obligation norm, then the seller cannot recognize the revenue till the project is complete.

To indicate: The method of revenue recognition which is used by the Company TK for long-term construction contracts.

Requirement – 2

To determine

To discuss: The manner in which the accounting for the contract differs.

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Answer 2

Question

Chapter 5, Problem 5.16BYP

Requirement – 1

To determine

International Financial Reporting Standards

They are commonly known as IFRS. These are set of accounting standards which are developed by independent (Non-profit) organization called as International Accounting Standards Board (IASB). These are universally accepted set of standards which state the rules and standards for accounting at global level.

Revenue recognized point of long term contract

A long-term contract qualifies for revenue recognition over time. The seller can recognize the revenue as per percentage of the completion of the project, which is recognized as revenue minus cost of completion until date.

If a contract does not meet the performance obligation norm, then the seller cannot recognize the revenue till the project is complete.

To indicate: The method of revenue recognition which is used by the Company TK for long-term construction contracts.

Requirement – 2

To determine

To discuss: The manner in which the accounting for the contract differs.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 5, Problem 5.16BYP

Requirement – 1

To determine

International Financial Reporting Standards

They are commonly known as IFRS. These are set of accounting standards which are developed by independent (Non-profit) organization called as International Accounting Standards Board (IASB). These are universally accepted set of standards which state the rules and standards for accounting at global level.

Revenue recognized point of long term contract

A long-term contract qualifies for revenue recognition over time. The seller can recognize the revenue as per percentage of the completion of the project, which is recognized as revenue minus cost of completion until date.

If a contract does not meet the performance obligation norm, then the seller cannot recognize the revenue till the project is complete.

To indicate: The method of revenue recognition which is used by the Company TK for long-term construction contracts.

Requirement – 2

To determine

To discuss: The manner in which the accounting for the contract differs.

Expert Solution & Answer

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See solution

Answer 4

Question

Chapter 5, Problem 5.16BYP

Requirement – 1

To determine

International Financial Reporting Standards

They are commonly known as IFRS. These are set of accounting standards which are developed by independent (Non-profit) organization called as International Accounting Standards Board (IASB). These are universally accepted set of standards which state the rules and standards for accounting at global level.

Revenue recognized point of long term contract

A long-term contract qualifies for revenue recognition over time. The seller can recognize the revenue as per percentage of the completion of the project, which is recognized as revenue minus cost of completion until date.

If a contract does not meet the performance obligation norm, then the seller cannot recognize the revenue till the project is complete.

To indicate: The method of revenue recognition which is used by the Company TK for long-term construction contracts.

Requirement – 2

To determine

To discuss: The manner in which the accounting for the contract differs.

Expert Solution & Answer

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Answer 5

Chapter 5, Problem 5.16BYP

Requirement – 1

To determine

International Financial Reporting Standards

They are commonly known as IFRS. These are set of accounting standards which are developed by independent (Non-profit) organization called as International Accounting Standards Board (IASB). These are universally accepted set of standards which state the rules and standards for accounting at global level.

Revenue recognized point of long term contract

A long-term contract qualifies for revenue recognition over time. The seller can recognize the revenue as per percentage of the completion of the project, which is recognized as revenue minus cost of completion until date.

If a contract does not meet the performance obligation norm, then the seller cannot recognize the revenue till the project is complete.

To indicate: The method of revenue recognition which is used by the Company TK for long-term construction contracts.

Requirement – 2

To determine

To discuss: The manner in which the accounting for the contract differs.

Answer 6

Chapter 5, Problem 5.16BYP

Requirement – 1

To determine

International Financial Reporting Standards

They are commonly known as IFRS. These are set of accounting standards which are developed by independent (Non-profit) organization called as International Accounting Standards Board (IASB). These are universally accepted set of standards which state the rules and standards for accounting at global level.

Revenue recognized point of long term contract

A long-term contract qualifies for revenue recognition over time. The seller can recognize the revenue as per percentage of the completion of the project, which is recognized as revenue minus cost of completion until date.

If a contract does not meet the performance obligation norm, then the seller cannot recognize the revenue till the project is complete.

To indicate: The method of revenue recognition which is used by the Company TK for long-term construction contracts.

Answer 7

Chapter 5, Problem 5.16BYP

Requirement – 1

To determine

International Financial Reporting Standards

They are commonly known as IFRS. These are set of accounting standards which are developed by independent (Non-profit) organization called as International Accounting Standards Board (IASB). These are universally accepted set of standards which state the rules and standards for accounting at global level.

Revenue recognized point of long term contract

A long-term contract qualifies for revenue recognition over time. The seller can recognize the revenue as per percentage of the completion of the project, which is recognized as revenue minus cost of completion until date.

If a contract does not meet the performance obligation norm, then the seller cannot recognize the revenue till the project is complete.

To indicate: The method of revenue recognition which is used by the Company TK for long-term construction contracts.

Answer 8

Requirement – 2

To determine

To discuss: The manner in which the accounting for the contract differs.

Answer 9

Requirement – 2

To determine

To discuss: The manner in which the accounting for the contract differs.

Answer 10

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Answer 11

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Answer 12

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Answer 13

Ch. 5 - What are the five key steps a company follows to...Ch. 5 - What indicators suggest that a performance...Ch. 5 - What criteria determine whether a company can...Ch. 5 - We recognize service revenue either at one point...Ch. 5 - What characteristics make a good or service a...Ch. 5 - Prob. 5.6Q Ch. 5 - What must a contract include for the contract to...Ch. 5 - How might the definition of probable affect...Ch. 5 - When a contract includes an option to buy...Ch. 5 - Prob. 5.10Q

Solution Summary: The author explains the IFRS accounting standards used by Company TK to account for long-term construction contracts.

To discuss: The manner in which the accounting for the contract differs.

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Chapter 5 Solutions