1. Sports clubs sell membership cards to customers who use services at the club with a membership fee of $300/card. On January 1, the club sold 2,800 membership cards and collected money. If the club makes an adjustment entry at the end of each month, the journal entry on January 31 is:
a. Dr Cash – Cr Membership Revenue
b. Dr Unrealized Revenue – Cr Cash
c. Dr Unrealized revenue – Cr Membership revenue
d. Dr Membership Revenue – Cr Unrealized Revenue
2. Company AB signs a contract to supply 100,000 bottles of cosmetics to company XY at $1,000/bottle and gives customers 500 lipsticks for buying
in bulk. AB is committed to refunding the money for the cosmetic bottles that do not meet the quality. What performance obligations does AB have in
the contract?
a. 4
b. 2
c. 3
d. 1
3. Rose is in the beauty industry. Rose offers a promotion that if customers buy X cosmetics for $30,000, they will get 10 free massages. Know that the listed price of Rose per massage is $500 and the normal selling price of Rose cosmetics without the promotion is $26,000. According to experience, the manager estimates that there is a 90% chance that customers will use massage vouchers. Revenue of cosmetics will be:
a. $4.426
b. $25.000
c. $26.000
d. $25.574
4. On July 1, 20x1, company P signed a contract to provide telecommunications services to X for a fee of $100,000 for 12 months and a free connection device. This device has a market price of $5,000 and the price of telecommunications service provided without the device is $10,000/month. Connection device may be available from other telecommunications providers. Total revenue recorded in July will be:
a. $4,000
b. $12,000
c. $5,000
d. $8,000
5. Light Company specializes in the production of wall lamps. In order to expand market share for existing LED products and introduce new NeoLed products, Light Company conducts the promotion "Buy 1 get 1 free". Specifically, buy one Led bulb worth 200,000 VND and get 1 NeoLed light for free. The usual selling price of Led lights is 200,000 VND, while the selling price of NeoLed lights has not been determined. On the market, the selling price of a product line similar to another company's NeoLed is 40,000 VND. In this contract, how many performance obligations under IFRS 15?
a. 4
b. 3
c. 2
d. 1
6. Elecity sells machines to customer X worth $100,000 and provides free maintenance after 1 year of use. Elecity commits to customers to exchange if the machine has technical defects within 3 months from the date of purchase. Electricity estimates that about $1,000 will be returned. The journal entry recognizes revenue at the date of sale as:
a. Dr Cash: $99,000 / Cr Revenue: $99,000
b. Dr Cash: $100,000 / Cr Revenue: $99,000, Cr Liabilities: $1,000
c. Other opinion
d. Dr Cash: $100,000 / Cr Revenue: $100,000
7. Telecom Co. enters into a two-year contract with a customer to provide wireless service (voice and data) for $40 per month. To induce customers, Telecom Co. provides a free phone. Telecom Co. normally sells the phone on a standalone basis for $200. Telecom Co. also charges the customer a one-time activation fee of $35. Which of the following is true?
a. The activation fee is a separate performance obligation
b. The free phone constitutes a marketing expense
c. There are two distinct performance obligations: the voice service and the data service
d. There are two distinct performance obligations: the wireless service and the phone
8. Which of the statements is not true in recognizing revenue in accordance with IFRS 15?
a. Transfers of goods will typically be recognized at a point in time
b. When a licence is a right to access the entity’s intellectual property throughout the licence period, revenue is recognized over time
c. Revenue may not be recognized when not all significant risks and rewards have been transferred to a third party
d. Revenue is recognized when the customer obtains control of the good or service
9. What types of contracts are exceptions to IFRS 15 guidance?
a. Medical contract and audit contract
b. Lease and insurance contract
c. Lease and loan agreement
d. Medical contract and loan contract
10. The retailer sells treadmills for $1,500 each and offers a 30% coupon to purchase another sports equipment in-store within 1 month of the treadmill purchase. Based on sales experience, the retailer estimates that 90% of customers will choose to purchase from this coupon and an estimated $1,000 will be sold from this coupon. Revenue recognized on the date of delivery of the treadmill will be:
a. $1,230
b. $270
c. $1,050
d. $1,500
a. Dr Cash – Cr Membership Revenue
b. Dr Unrealized Revenue – Cr Cash
c. Dr Unrealized revenue – Cr Membership revenue
d. Dr Membership Revenue – Cr Unrealized Revenue
2. Company AB signs a contract to supply 100,000 bottles of cosmetics to company XY at $1,000/bottle and gives customers 500 lipsticks for buying
in bulk. AB is committed to refunding the money for the cosmetic bottles that do not meet the quality. What performance obligations does AB have in
the contract?
a. 4
b. 2
c. 3
d. 1
3. Rose is in the beauty industry. Rose offers a promotion that if customers buy X cosmetics for $30,000, they will get 10 free massages. Know that the listed price of Rose per massage is $500 and the normal selling price of Rose cosmetics without the promotion is $26,000. According to experience, the manager estimates that there is a 90% chance that customers will use massage vouchers. Revenue of cosmetics will be:
a. $4.426
b. $25.000
c. $26.000
d. $25.574
4. On July 1, 20x1, company P signed a contract to provide telecommunications services to X for a fee of $100,000 for 12 months and a free connection device. This device has a market price of $5,000 and the price of telecommunications service provided without the device is $10,000/month. Connection device may be available from other telecommunications providers. Total revenue recorded in July will be:
a. $4,000
b. $12,000
c. $5,000
d. $8,000
5. Light Company specializes in the production of wall lamps. In order to expand market share for existing LED products and introduce new NeoLed products, Light Company conducts the promotion "Buy 1 get 1 free". Specifically, buy one Led bulb worth 200,000 VND and get 1 NeoLed light for free. The usual selling price of Led lights is 200,000 VND, while the selling price of NeoLed lights has not been determined. On the market, the selling price of a product line similar to another company's NeoLed is 40,000 VND. In this contract, how many performance obligations under IFRS 15?
a. 4
b. 3
c. 2
d. 1
6. Elecity sells machines to customer X worth $100,000 and provides free maintenance after 1 year of use. Elecity commits to customers to exchange if the machine has technical defects within 3 months from the date of purchase. Electricity estimates that about $1,000 will be returned. The journal entry recognizes revenue at the date of sale as:
a. Dr Cash: $99,000 / Cr Revenue: $99,000
b. Dr Cash: $100,000 / Cr Revenue: $99,000, Cr Liabilities: $1,000
c. Other opinion
d. Dr Cash: $100,000 / Cr Revenue: $100,000
7. Telecom Co. enters into a two-year contract with a customer to provide wireless service (voice and data) for $40 per month. To induce customers, Telecom Co. provides a free phone. Telecom Co. normally sells the phone on a standalone basis for $200. Telecom Co. also charges the customer a one-time activation fee of $35. Which of the following is true?
a. The activation fee is a separate performance obligation
b. The free phone constitutes a marketing expense
c. There are two distinct performance obligations: the voice service and the data service
d. There are two distinct performance obligations: the wireless service and the phone
8. Which of the statements is not true in recognizing revenue in accordance with IFRS 15?
a. Transfers of goods will typically be recognized at a point in time
b. When a licence is a right to access the entity’s intellectual property throughout the licence period, revenue is recognized over time
c. Revenue may not be recognized when not all significant risks and rewards have been transferred to a third party
d. Revenue is recognized when the customer obtains control of the good or service
9. What types of contracts are exceptions to IFRS 15 guidance?
a. Medical contract and audit contract
b. Lease and insurance contract
c. Lease and loan agreement
d. Medical contract and loan contract
10. The retailer sells treadmills for $1,500 each and offers a 30% coupon to purchase another sports equipment in-store within 1 month of the treadmill purchase. Based on sales experience, the retailer estimates that 90% of customers will choose to purchase from this coupon and an estimated $1,000 will be sold from this coupon. Revenue recognized on the date of delivery of the treadmill will be:
a. $1,230
b. $270
c. $1,050
d. $1,500
