mmy John Ltd has a customer loyalty programme that rewards a customer with one customer loyalty point for every $10 of purchases. Each point is redeemable for a $1 discount on any future purchases Customers purchase products for $100,000 and earn 10,000 points The entity expects 9,500 points to be redeemed, so they have a stand-alone selling price $9,500 Identify the steps in the revenue recognition process match the steps to the relevant process in the case above to describe how it will be dealt with under IFRS 15?
mmy John Ltd has a customer loyalty programme that rewards a customer with one customer loyalty point for every $10 of purchases. Each point is redeemable for a $1 discount on any future purchases Customers purchase products for $100,000 and earn 10,000 points The entity expects 9,500 points to be redeemed, so they have a stand-alone selling price $9,500 Identify the steps in the revenue recognition process match the steps to the relevant process in the case above to describe how it will be dealt with under IFRS 15?
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter8: Current And Contingent Liabilities
Section: Chapter Questions
Problem 7MCQ
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Sammy John Ltd has a customer loyalty programme that rewards a customer with one customer loyalty point for every $10 of purchases.
Each point is redeemable for a $1 discount on any future purchases
Customers purchase products for $100,000 and earn 10,000 points
The entity expects 9,500 points to be redeemed, so they have a stand-alone selling price $9,500
- Identify the steps in the revenue recognition process
- match the steps to the relevant process in the case above to describe how it will be dealt with under IFRS 15?
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1 Steps in revenue Reconition process
VIEWStep 1 Identifying the contract
VIEWStep 2 Identify separate performance obligations
VIEWStep 3 Determination of the transaction price
VIEWStep 5 Allocation of transaction price to performance obligations
VIEWStep 5 Recognise revenue when each performance obligation is satisfied
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