Question 2.0

Imagine yourself as the accountant of Chonng Berhad. Your managing director has approached you regarding some issues about contract. His doubt included:- (i) A modification to existing contract should be treated as a separate contact. (ii) If the agreed date of payment by a customer is later than the date on which services are transferred to that customer, part of the consideration should be treated as interest and not revenue. (iii) If a contract with customer provided warranty after service, the warranty represents a separate performance obligation, thus part of transaction price should be allocated for warranty.

Required: - In accordance with Malaysian Financial Reporting Standards (MFRS) 15 Revenue from Contracts with Customers, discuss the above issues. [8 marks]