Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

PROBLEM A - Revenue Recognition Organic Company has consignment agreement with Eigen Company to sell sewing machines. PT Organic agree to give 5% from sales

image text in transcribed
PROBLEM A - Revenue Recognition Organic Company has consignment agreement with Eigen Company to sell sewing machines. PT Organic agree to give 5% from sales amount as commission fee to Eigen Company if Eigen Company can sell the sewing machine and giving more than 10% margin to Organic Company. If not, the Organic Company only gives 3% commission fee. On Febr 3, 2019 Organic Company send 125 unit with cost $600 per unit and pay 15% of delivery cost to Earth Company. Earth company get the notification regarding the cost of product and the delivery cost from Organic company. On Dec 31, 2020 Eigen can sell 100 units of sewing machine with price $800 each. Remittance will be made by Earth Company for covering all expenses for boosting the quantity sold, such as advertising cost $25 and installation cost $50 for that period. 1. How much is inventory unsold hold by consignee 2. how much is profit on consignment sales after commision charge 3. How much cash will be remitted by the consignee 4. Explain how each party identifying the performance obligation fulfilment in applying the Revenue Recognition under IFRS (short explanation, please)

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_2

Step: 3

blur-text-image_3

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

Clinical Audit In Mental Health Toward A Multidisciplinary Approach

Authors: John Riordan, Darren Mockler

1st Edition

0471963321, 978-0471963325

More Books

Students also viewed these Accounting questions

Question

How do current liabilities and long-term liabilities differ?

Answered: 1 week ago

Question

2. What is the impact of information systems on organizations?

Answered: 1 week ago

Question

Evaluate the impact of technology on HR employee services.

Answered: 1 week ago