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IAS 18: REVENUE Q1. Under the terms of arrangement that Ahodwo Limited has with a customer, the customer gets a 2% discount on the
IAS 18: REVENUE Q1. Under the terms of arrangement that Ahodwo Limited has with a customer, the customer gets a 2% discount on the total purchases that they make over a 12month period, provided the total purchases exceed GHC 1 million per year. During the 9 month financial period from April 1, 2013, to December 31, 2013, the sales to the customer were GHC 900,000. How much revenue should Ahodwo Limited recognize? Q2. Total Sales of a company included a sum of GHC 183 million representing royalties receivable for supply of know-how to a company in Nigeria. According to the royal agreement, the amount is to be received in US Dollars. However, exchange permission was denied to the company in Nigeria for remitting the same. How should this be treated in the books? Q3. Alavanyo Publication Ltd has received 200,000 subscriptions during the current year under its new scheme whereby customers are required to pay a sum of GHC 50, for which they will be entitled to receive Lifestyle magazine for a period of 2 years. Can Alavanyo Publication treat the entire amount as revenue for the current year?
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