On 1 July 2022, Royce Ltd signed an agreement with Rolls Ltd to supply and install...

 

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On 1 July 2022, Royce Ltd signed an agreement with Rolls Ltd to supply and install 180 solar panels in a newly built block for a contract price of $35,640 (GST inclusive). This amount also includes one free service for all 180 solar panels four months from installation. Below is the standalone price for every activity: Price of one solar panel Price of installing one solar panel Price of servicing one panel Amount (GST inclusive) $198 $69.3 $49.5 Half of the 180 solar panels were installed on 11 August 2022, and the remaining half was installed one week later. Rolls Ltd paid the 70% of the total amount on 20 July 2022 and the remaining one week later. Required: Following the five-step revenue recognition model based on the contents of AASB 15, allocate the transaction price to each performance obligation and show your workings. (4 marks) On 1 July 2022, Royce Ltd signed an agreement with Rolls Ltd to supply and install 180 solar panels in a newly built block for a contract price of $35,640 (GST inclusive). This amount also includes one free service for all 180 solar panels four months from installation. Below is the standalone price for every activity: Price of one solar panel Price of installing one solar panel Price of servicing one panel Amount (GST inclusive) $198 $69.3 $49.5 Half of the 180 solar panels were installed on 11 August 2022, and the remaining half was installed one week later. Rolls Ltd paid the 70% of the total amount on 20 July 2022 and the remaining one week later. Required: Following the five-step revenue recognition model based on the contents of AASB 15, allocate the transaction price to each performance obligation and show your workings. (4 marks)

Answer rating: 100% (QA)

To allocate the transaction price to each performance obligation according to the fivestep revenue recognition model based on AASB 15 we need to follow these steps Step 1 Identify the contract with th... View the full answer