A bill-and-hold arrangement is when an entity bills a customerfor a product but the entity retains physical
Question:
A bill-and-hold arrangement is when an entity bills a customerfor a product but the entity retains physical possession of theproduct until it is transferred to the customer at a point in timein the future. IFRS 15 states that revenue may be recognized inbill-and-hold arrangements only if certain criteria are met.
Which of the following is a revenue recognition criterion forbill-and-hold arrangements?
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Question 24 (1 point)
Which of the following statements regarding revenue recognitionfor an entity that reports using IFRS is true?
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Question 25 (1 point)
Sam’s Fuel Stop (SFS), an entity that follows ASPE, is a chainof gas stations. To encourage customers to regularly buy itsproducts, customers registered in SFS’s loyalty program receive oneGas Buck for each dollar spent on gas at any of SFS’s outlets. TheGas Buck program is run by a third-party provider that permitsparticipants to exchange points for merchandise and services. SFSpays the third-party operator $0.02 per Gas Buck earned on behalfof its customers. SFS has seen statistics that suggest that only70% of the points awarded in the rewards program are ever exchangedfor goods and services.
In April 2020, SFS had fuel sales totalling $2,200,000 and awarded1,600,000 Gas Bucks to its registered customers. The cost of thefuel sold was $1,800,000. On May 16, 2020, SFS paid thethird-party provider for the points awarded in April.
What amount should SFS recognize as an expense on its April 2020income statement pertaining to the Gas Buck program?
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Auditing and Assurance services an integrated approach
ISBN: 978-0132575959
14th Edition
Authors: Alvin a. arens, Randal j. elder, Mark s. Beasley