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Dear mike , hope u r fine. simple question that mixes me up..
case 1.
sale of goods,do u recognise the revenue related to the sale of goods if installation not yet completed? i would say nocase 2. u have sale of goods and u have installation fees seperate, goods sold but installation not complete..so i recognise revenue with respect of goods and defer income with respect to installation fees until that installation completed.
still case 2 now if installation half complete ..i recognise 1/2 and defer 1/2..by reference to stage of completion of installation..
is everything i said ok..please correct me if am wrong?
Not happy with your case 1 🙁
An effort should be made to calculate the installation fee element of the cost of supply and installation
Otherwise, yes, that seems ok
so what u saying in case one is.. in a question the intstallation fee would be given or hints given as to its amount..so then recognise only the portion of the sale of the goods..n the installation portion recognised upon installation or by stage of its completion..so in summary the question will hint as to the proportion of the fee that relates to installation right and recognise that by reference to the stage of completion of the installation?
am i right please?
That’s exactly what I’m saying but that applies not just to an exam question! It applies too in a real life situation 🙂
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