Question
MNC Ltd delivers goods to PBC Ltd on 9 April. Both parties agree that PBC Ltd will hold the goods on consignment to be sold
MNC Ltd delivers goods to PBC Ltd on 9 April. Both parties agree that PBC Ltd will hold the goods on consignment to be sold to third parties. PBC Ltd is not required to pay MNC Ltd for the goods until they are sold to a third party. Which of the following statements is incorrect?
a.
At the time of delivery of the goods to PBC Ltd there is no probability that future economic benefits will flow to MNC Ltd.
b.
MNC Ltd retains the risks and rewards of ownership of the goods after delivery to PBC Ltd.
c.
MNC Ltd recognises revenue on 9 April for the sale of goods to PBC Ltd.
d.
MNC Ltd does not recognise any revenue until PBC Ltd has on-sold goods to a third party.
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