D'Mask Bhd sells 3 ply surgical face masks. On 1 January 2020, D'Maskentered a contract with Topeng Bhd under which Topeng Bhd was topurchase one box of the face masks at RM20 from D'Mask.The contract states that if Topeng Bhd purchases more than 5,000boxes of masks in a year, the price per box is reduced retrospectively toRM18 per box (i.e. all purchases will be RM18 per box). D'Mask Bhd'syear end is 31 December.As at 31 March 2020, Topeng Bhd bought 600 boxes from D'Mask.D'Mask therefore estimated that Topeng Bhd's purchases would notexceed 5,000 boxes in the year to 31 December 2020, and Topeng Bhdwould therefore not be entitled to the volume discount.During the quarter ended 30 June 2020, due to high demand, TopengBhd purchased an additional 3,000 boxes of masks from D'Mask.D'Mask then estimated that Topeng Bhd's purchases would exceed thethreshold for the volume discount in the year to 31 December 2020.Required:Compute the revenue D'Mask Bhd would recognise in the quarterended:(a)31 March 2020.(b)30 June 2020

The question deals with IFRS 15 "Revenue from contracts with customers". As per IFRS 15, revenue is…

Bhd purchased an additional 3,000 boxes of masks from D'Mask. D'Mask then estimated that Topeng Bhd's purchases would exceed the threshold for the volume discount in the year to 31 December 2020. Required: Compute the revenue D'Mask Bhd would recognise in the quarter ended: (a) 31 March 2020. (b) 30 June 2020

Bhd purchased an additional 3,000 boxes of masks from D'Mask. D'Mask then estimated that Topeng Bhd's purchases would exceed the threshold for the volume discount in the year to 31 December 2020. Required: Compute the revenue D'Mask Bhd would recognise in the quarter ended: (a) 31 March 2020. (b) 30 June 2020

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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