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Eire is a company that manufactures and sells mobile phones and mobile phone contracts.
It prepares its financial statements under International Financial Reporting Standards
and has a year end of 30 April 2020.
(a) Eire launched a promotion during the year to attract new customers to its network.
Under this promotion, customers sign a non-cancellable contract to subscribe to the
Eire network for twelve months. The cost is $30 per month, payable at the end of
each month. This price includes a new handset and network access. The normal
retail price of these elements is as follows:
Handset 250
Network access (per month) 15
In total, 100,000 new customers signed up for this promotion. The contracts all
began on 1 March 2020.how it will accounted
Hello. I make the same point as in my last post to you. I’m not here to just answer a full question for you. You need to answer it first yourself and then ask when you are struggling with a particular part. It is better for your learning that way.
Looking forward to hearing where you are struggling with the question so that I can help.
Thanks
-i think here in the above question normal cost don’t need to bother
– the contract begin on 1 march 2020 and amt received at the end of mnth then dr cash and cr revenue by 30*100000
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