Sales with Right of Return

Hi Sir,

I just want to ask for the below question if 1st Statement is still not correct as IFRS 15 is in effect now (note that this is from June 2015 question, I checked in 2015 syllabus IFRS 15 is not yet included) and I found some previous post regarding this question when you advise that sales return provision is recorded to the extent of loss of profit (margin).

As per IFRS 15 par B21 (Sales with a right of return) states that a refund liability is to be accounted on the Sales revenue amount, I just want to confirm if Statement 1 is correct?

In a review of its provisions for the year ended 31 March 2015, Cumla’s assistant accountant has suggested the following accounting treatments:
(i) Making a provision for a constructive obligation of $400,000; this being the sales value of goods expected to be returned by retail customers after the year end under the company’s advertised 30-day returns policy
(ii) Based on past experience, a $200,000 provision for unforeseen liabilities arising after the year end
(iii) The partial reversal (as a credit to the statement of profit or loss) of the accumulated depreciation provision on an item of plant because the estimate of its remaining useful life has been increased by three years
(iv) Providing $1 million for deferred tax at 25% relating to a $4 million revaluation of property during March 2015 even though Cumla has no intention of selling the property in the near future
Which of the above suggested treatments of provisions is/are permitted by IFRS?

A (i) only
B (i) and (ii)
C (ii) and (iii)
D (iv)

Suggested answer here is D.

Regards,
jefrey Abanilla