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31.The right of return a separate performance obligation, and a

Question : 31.The right of return a separate performance obligation, and a : 1412627

 

 

31.The right of return is a separate performance obligation, and a portion of the transaction price needs to be allocated to it for revenue recognition. 
 
 

 

 

 

32.When the right of return exists, revenue can be recognized at the point of sale if the seller can make reliable estimates of future returns. 
 
 

 

 

 

33.If the seller is a principal, the seller has primary responsibility for delivering a product or service. 
 
 

 

 

 

34.If the seller is a principal, the seller typically is not vulnerable to risks associated with delivering the product or service. 
 
 

 

 

 

35.If the seller is a principal, the seller typically is vulnerable to risks associated with collecting payment from the customer. 
 
 

 

 

 

36.If the seller is a principal, the seller should recognize gross revenue and cost of sales associated with the transaction. 
 
 

 

 

 

37.If the seller is an agent, the seller typically is vulnerable to risk associated with delivering the product or service. 
 
 

 

 

 

38.If the seller is an agent, the seller typically recognizes cost associated with the sale on its own line in the income statement. 
 
 

 

 

 

39.The transaction price should be adjusted to reflect the time value of money for interest payable, but not for interest receivable. 
 
 

 

 

 

40.Sellers are only required to adjust the transaction price to reflect the time value of money when the contract has a significant financing component. 
 
 

 

 

 

 

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