CAF-6 · Chapter 5 · Question 6 of 15
If a contract has a significant financing component (payment is delayed by 2 years), the transaction price should be:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) The cash selling price at the date of transfer.
Explanation
The transaction price is adjusted for the time value of money if there is a significant financing component, typically reflecting the cash selling price at the time of transfer.
More IFRS 15 Revenue from Contracts with Customers MCQs
- Q8Revenue is recognized 'Over Time' if:
- Q9Control of an asset is transferred to a customer when the customer has:
- Q10If an entity acts as an 'Agent', how much revenue should it recognize?
- Q11A contract modification is treated as a 'Separate Contract' if the scope increases by adding distinct goods and:
- Q12Assurance-type warranties (that the product complies with agreed specifications) are accounted for under: