Question 1: Which of the following are not covered by Section 23 Revenue? a. Revenue from lease agreements. b.

Changes in FV of financial assets and financial liabilities or their disposal. c. Change in FV of biological assets relating to agricultural activity. d. All of the above.

Question 2: Percentage of completion must be used to recognize revenue from: a. Rendering of services and construction contracts. b. Rendering of services, only when the outcome can be estimated reliably. c. Construction contracts, only when the outcome can be estimated reliably. d. Both b and c.

Question 3: In general, revenue is recognized when the earnings process is substantially complete and: a) The sales price has been realized or is realizable. b) The sales price has been collected. c) Production is completed. d) A purchase order has been received. Question 4: Car dealer sales promotion free servicing and 2-years zero interest credit. Recognise revenue separately for: a. Entirely sale of goods? b. Sale of goods and rendering of maintenance services? c. Sale of goods, rendering of services, and a financing element (interest) related to the deferred payment?

Problem 1: In 20X1, Build Construction Corporation contracted to build a motel. The contract price is P300,000 and the total cost is estimated as P200,000. Over the construction period there has been no change in either the contract price or the estimated total cost. Costs incurred for 20X1 and 20X2 are

P100,000 and P80,000, respectively. How much gross profit should be recognized in 20X1 under the percentage-of-completion method? a. b. c. d. P50,000 P100,000 P120,000 P40,000

Answer: P50,000 Solution: Total gross profit ($300,000 - $200,000) Gross profit rate ($100,000 / $200,000) Gross profit realized in 20X1 OR Contract Price Cost (100,000/200,000) Gross Profit Realized P100,000 50% P50,000 P100,000 50% P50,000

Problem 2: Goods with list price of P1, 000 sold to customer on normal credit terms. Customer pays 690 in full settlement. There is P200 trade discount, P100 volume rebate, P10 prompt payment discount. Of the P690, P50 is sales tax to be remitted to government. How much profit should be recognized? a. b. c. d. P640 P690 P1,000 P900

Answer: Profit of P640. Solution: P1,000 list price less P200 trade discount less P100 volume rebate less 10 prompt-settlement discount less P50 sales tax collected on behalf of the government = P640.

I can live with losing a good fight, but I cannot live without fighting it! When I became a runner, I knew running was an epic battle and only a warrior who believed running was not about what your feet could do for you but what you could do with your feet. I knew sometimes things would get a little scary but courage - it isn't the absence of fear, it is the presence of fear yet the will of the heart. And on that day, a Runner was born.

Struggles! Difficulties! Challenges! All these we see daily and we feel like giving up but remember: there is a dawn after the night.