Below are three revenue recognition situations.

(a)

Groupo sells goods to MTN for $1,058,000, payment due upon delivery.

(b)

Groupo sells merchandise on account to Grifols for $804,000, 30-day payment.

(C)

Groupo sells assets to Magnus for $455,000, payment due in two installments, the first installment due in 18 months and the second installment due 6 months later. The present value of future payments is $417,200.

Indicate the transaction price for each of these situations and when revenue will be recognized.

transaction price

ps

ps

ps

revenue will be recognized

At the point of sale
On delivery

At the point of sale
At the time of payment

At the point of sale
At the time of payment

Answer rating: 100% (QA)

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