1. Concord has prepared its draft financial statements for the year ended 30 September 2019. It has included the following transactions in revenue at the amounts stated below.
Which of these has been correctly included in revenue according to IFRS 15 Revenue from Contracts with Customers?
2. Which TWO of the following are acceptable methods of accounting for a government grant relating to an asset in accordance with IAS 20 Accounting for Government Grants and Disclosure of Government Assistance?
1. Add the grant to the carrying amount of the asset
2. Credit the amount received to profit or loss
3. Set up the grant as deferred income
4. Deduct the grant from the carrying amount of the asset
4. Consignment inventory is an arrangement whereby inventory is held by one party but owned by another party. It is common in the motor trade
Which TWO of the following indicate that the inventory in question is consignment inventory?
1. Manufacturer bears obsolescence risk
2. Dealer has no right of return of the inventory
3. Dealer bears slow movement risk
4. Manufacturer can require dealer to return the inventory
5. Which of the following items has correctly been included in Nelson Bay’s revenue for the year to 31 December 2017?
8. Liscome Co successfully receives a government grant of $1,800,000 on 1 January 2019 allowing it to purchase an asset which costs $750,000, also on 1 January 2019. The asset has a ten-year useful life and is depreciated on a 15% reducing balance basis. Company policy is to account for all grants received as deferred income.
What amount of income will be recognised in respect of the grant in the year to 31 December 2019?