Question: Recognise Revenue as PO Satisfied A developer is constructing a medium rise residential building which has 10 storeys. Each storey has 10 residential units. Contract

Recognise Revenue as PO Satisfied

A developer is constructing a medium rise residential building which has 10 storeys. Each storey has 10 residential units.

Contract 1 Customer buys a unit in the building and pays a deposit. The deposit is only refundable if the developer fails to complete construction of the unit. Balance is payable when construction is completed, and customer obtains physical possession of the unit. If customer defaults, developer can only retain the deposit

Contract 2 Customer buys a unit in the building and pays a non-refundable deposit Customer also needs to make progress payments during the construction The developer cannot sell the unit to another customer If customer defaults, the developer has the right to claim for all the consideration promised provided the developer has completed the construction of the unit.

Discuss when the developer should recognise the revenue.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

Based on your selected annual report: Compute all necessary ratios (10 marks)Discuss all relevant ratios affecting the overall performance of the business (10 marks)Decide as to whether you would...

How does Hydro One make money? 1. What are the objectives of Hydro One? (profit max, low prices, satisfy engineering constraints, markets, regulators etc?) 2. How does Hydro one make money? (Sources...

Enterprise Risk Management at Hydro One (A) The Toronto skyline glittered in the early gloom of winter as chief executive Laura Formusa returned to her glass-walled office. She knew that the winter...

Hi, I have an Assignment for my Finance Subject. I have attached the necessary documentation here for you to view including the Lecture slides of all the Topics covered for this assignment. Please...

Would you please help ? The requirements are attached , with financial statements. Thank you so much Fujairah Cement Industries Company (Public Shareholding Company) Fujairah - United Arab Emirates...

See Park City_CAFR_ 2014.pdf See ACC530_CAFR Project_S15.doc Pls help me answer the Part 8-Part 10 of the CAFR project. ACCT530- Accounting for Public Sector Entities CAFR Project Due Friday, April...

Within the tax jurisdiction of the Republic of Singapore, determine Anthony's tax amount. (Please refer to case study for question) CASE STUDY - Mr & Mrs Anthony Chan Soon Thoong Anthony is 35 years...

Part 1 Accompanying this text, on its website, is a Comprehensive Annual Financial Report (CAFR) of the city of Austin, Texas. A CAFR includes an entity's year-end ?nancial statements; it is not the...

The attachment , is a Comprehensive Annual Financial Report (CAFR) of the city of Austin, Texas. ACAFRincludes an entity's year-end ?nancial statements; it is not the same as its budget....

Is it possible to construct a sphere that pass through the following points? (a) {(0,1, 2, ), (3, 4, 5), (6,7,8), (9, 10, 11)} (b) {(0,1,2), (1,3, 1), (2, 1,0), (3, 1, 1)} If possible, find the...

One of the main benefits of grid computing arises from the possibility of replacing expensive hardware, such as mainframes or supercomputers, with commodity-priced servers and even personal...

Which of the following items would not be included in the calculation of the lease obligation? a . bargain purchase option b . any payments required for fallure to renew or extend the lease c ....

In Medical Sociology, we see that African-American males tend to live somewhat shorter lives than their male counterparts in various races. Based on researchers, what are some factors that may...