Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On 1 November 2020, Logitech Sdn Bhd (Logitech) sells a tablet to Kenny for RM6,000. As part of this arrangement, Logitech gives Kenny a voucher.

On 1 November 2020, Logitech Sdn Bhd (Logitech) sells a tablet to Kenny for RM6,000. As part of this arrangement, Logitech gives Kenny a voucher. The voucher entitles Kenny to a 25% discount on any purchases up to RM2,000 in any Logitechs store during the next 60 days. The voucher can only be redeemed once. Logitech intends to offer a 10% discount on all sales to other customers during the next 60 days as its seasonal promotion. The 10% discount cannot be used in addition to the 25% discount voucher. Logitech estimates that there is an 80% likelihood that Kenny will redeem the voucher and will purchase additional products at a normal price of RM1,500. On 1 December 2020, Kenny purchased 2 pen tablets at a normal price of RM600 from a Logitechs store at Sunway City. Kenny redeemed the 25% discount voucher on 1 December 2020. Required: Discuss the correct accounting treatment for the recognition of revenue under the IFRS 15/ MFRS 15 Revenue from Contracts with Customer. (Note: Show all relevant journal entries in your discussion) (20 marks)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing The Art And Science Of Assurance Engagements

Authors: Alvin A. Arens, Randal J. Elder, Mark S. Beasley, Ingrid B. Splettstoesser-Hogeterp

11th Edition

0132088061, 978-0132088060

More Books

Students also viewed these Accounting questions