IFRS 15 is to recognize revenue in a way that shows the transfer of goods/services promised to customers in an amount reflecting the expected consideration in return for those goods or services. Furthermore, its focuses on contractual relationship with the customer, performance obligation, transaction price, allocation objective and performance obligation is satisfied when a promised good or service is transferred to a customer. Suppose an entity supplies a product to a customer for a total price of RM20,000. The price includes two years 'free' servicing of the product. The entity estimates that the annual cost of servicing the product will be RM2,400. The entity normally earns a margin of 20% on service revenue. Required a. Explain how much is the revenue for the Sales of Product of the entity? b. Explain how much is the revenue of the revenue for the Sales of Services? (2 marks) c. According to IFRS 15, should the Sales of Services to be recognise immediately or across 2 years? (2 marks) (1 mark) (Total: 5 Marks)