In which of the following scenarios would IFRS 15 require the entities to combine the contracts and
Question:
In which of the following scenarios would IFRS 15 require the entities to combine the contracts and account for them as a single contract?
On 29 August Smelly Soaps Ltd. entered into three separate contracts with Common Cleaners Inc. Each contract has different characteristics and commercial objectives and consideration for each contract is independent of the other contracts. The goods and services are not one performance obligation.
On 16 October, Carpeting Plus Ltd. entered into a contract with Safety Inc. to carpet Safety Inc.’s alarm monitoring control office with industrial style carpet tiles. Ten months later Carpeting Plus Ltd. entered into another contract to carpet Safety Inc.’s head office with underlaid carpet.
On 10 May, Safety Inc. entered into two contracts with Best Bankers Ltd. The two contracts, required solely for internal management reasons, were negotiated for the purpose of installing a security alarm system complete with panic buttons and 24/7 alarm monitoring.
On 15 September, Heavenly Rooms Ltd. entered into contracts with three interior design companies, Our Home Inc., Tranquil Ltd. and Home Artistry Ltd. to supply furniture and décor accessories for home interiors. The three interior design companies are unrelated parties.
Auditing and Assurance Services
ISBN: 978-0077862343
6th edition
Authors: Timothy Louwers, Robert Ramsay, David Sinason, Jerry Straws