C4: REVENUE RECOGNITION Flashcards
1
Q
Inflows from cash and accounts receivable, such as sale of goods and provision of services are an example of:
A
Revenue
2
Q
Two types of Revenue Recognition:
A
- IFRS (Contract-based)
- ASPE (Earnings-based)
3
Q
What is a contract based revenue recognition?
A
IFRS
4
Q
Revenue is recognized whenever a company’s net position ____________.
A
Increases
5
Q
T/F: If performance obligations decrease, then we cannot recognize revenue.
A
False
6
Q
Companies must fulfill ____________________ to increase net position.
A
Performance Obligations
7
Q
Is assurance warranty a performance obligation?
A
No
8
Q
Companies estimate expected returns and also allocate a portion of the transaction price to service warranties to avoid:
A
Revenue Recognition Issues