Under IFRS,when the cost recovery method is applied to installment sales,the seller will recognize gross profit only after the cumulative amount of cash collected exceeds the cost of sales.

Question

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This is correct. Under the cost recovery method, the seller only recognizes gross profit once the cumulative amount of cash collected exceeds the cost of sales. Until that point, the seller only recognizes cash received as a reduction of the cost of sales.

Under IFRS,when the Cost Recovery Method Is Applied to Installment