MN Plc's revenue as shown in its draft statement of profit or loss for the year ended 31 December 20X9 is GHS27m. This includes: (i) GHS8m for a consignment of goods sold on 31 December 20X9 on which MN Plc will incur ongoing service and support costs for two years after the sale. The cost of providing service and support is estimated at GHS800,000 per annum. MN Plc applies a 30% mark-up to all service costs. (ii) GHS4m collected on behalf of Aintree. MN Plc acts as an agent for Aintree and receives a 10% commission on all sales. At what amount should revenue be shown in the statement of profit or loss of MN Plc for the year ended 31 December 20X9? (Ignore the time value of money.) A. GHS22,920,000 B. GHS21,800,000 C. GHS20,520,000 D. GHS21,320,000
MN Plc's revenue as shown in its draft statement of profit or loss for the year ended 31 December 20X9 is GHS27m. This includes: (i) GHS8m for a consignment of goods sold on 31 December 20X9 on which MN Plc will incur ongoing service and support costs for two years after the sale. The cost of providing service and support is estimated at GHS800,000 per annum. MN Plc applies a 30% mark-up to all service costs. (ii) GHS4m collected on behalf of Aintree. MN Plc acts as an agent for Aintree and receives a 10% commission on all sales. At what amount should revenue be shown in the statement of profit or loss of MN Plc for the year ended 31 December 20X9? (Ignore the time value of money.) A. GHS22,920,000 B. GHS21,800,000 C. GHS20,520,000 D. GHS21,320,000
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter9: Metric-analysis Of Financial Statements
Section: Chapter Questions
Problem 9.2.2P
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MN Plc's revenue as shown in its draft statement of profit or loss for the year ended 31 December 20X9 is GHS27m.
This includes:
(i) GHS8m for a consignment of goods sold on 31 December 20X9 on which MN Plc will incur ongoing service and support costs for two years after the sale. The cost of providing service and support is estimated at GHS800,000 per annum. MN Plc applies a 30% mark-up to all service costs.
(ii) GHS4m collected on behalf of Aintree. MN Plc acts as an agent for Aintree and receives a 10% commission on all sales.
At what amount should revenue be shown in the statement of profit or loss of MN Plc for the year ended 31 December 20X9? (Ignore the time value of money.)
A. GHS22,920,000
B. GHS21,800,000
C. GHS20,520,000
D. GHS21,320,000
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