Under IAS 18,if four out of the five conditions for recognizing revenue from the sale of goods are met,and the entity is 75% certain that revenue will be recognized as a result,how would a $100,000 sale be recognized at the time of the sale?
A)The recognition of the entire sale must be deferred until the fifth condition has been met.
B)$75,000 of the sales price can be currently recognized and $25,000 will be treated as a liability.
C)The entire $100,000 sales price can be currently recognized since most of the conditions have been met.
D)None of the above represents a proper treatment of this sale.

Question

Quizplus · Accepted Answer

According to IAS 18, revenue from the sale of goods can be recognized if four out of the five conditions are met, and the entity is 75% certain that revenue will be recognized. In this scenario, since four out of the five conditions are met and the entity is 75% certain that revenue will be recognized, $75,000 of the sales price can be recognized as revenue, and $25,000 will be treated as a liability until the remaining condition is met. Therefore, the correct choice is B.

Under IAS 18,if Four Out of the Five Conditions for Recognizing