, Question 1 Solution
(a) Journal Entries for Road Bike Sale (IFRS 15)
27 January 2025: Recognition of Sale and Contract Liability
Dr R Cr R
Bank/Cash 41,678
Contract Liability (SFP) 1,235
Revenue (P/L) 40,443
27 February 2025: Recognition of Revenue from Service One
Dr R Cr R
Contract Liability (SFP) 309
Revenue (P/L) 309
Workings:
Workings for (a):
W1: Transaction Price Allocation
Total Cash Received: (R51,410 * 80%) + R550 = R41,128 + R550
= R41,678
Standalone Selling Prices: Bike R51,410, Shoes R550, Plan R1,590. Total
R53,550.
Total Discount: R53,550 - R41,678 = R11,872.
(a) Journal Entries for Road Bike Sale (IFRS 15)
27 January 2025: Recognition of Sale and Contract Liability
Dr R Cr R
Bank/Cash 41,678
Contract Liability (SFP) 1,235
Revenue (P/L) 40,443
27 February 2025: Recognition of Revenue from Service One
Dr R Cr R
Contract Liability (SFP) 309
Revenue (P/L) 309
Workings:
Workings for (a):
W1: Transaction Price Allocation
Total Cash Received: (R51,410 * 80%) + R550 = R41,128 + R550
= R41,678
Standalone Selling Prices: Bike R51,410, Shoes R550, Plan R1,590. Total
R53,550.
Total Discount: R53,550 - R41,678 = R11,872.
