5-step Model for Revenue Recognition under IFRS 15 + Example + Journal entries

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How to apply 5-step model? This example deals with the typical telecom contract where the customer gets free mobile phone if he signs up for 12-month plan of network services.
Journal entries included!
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[@CPDbox]

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[@VictorFromCharleville]

The CLEAREST teacher of accounting in the world. God bless you, Madam.

[@mohitagarwal220]

Very nicely articulated!

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WOW, WELL SIMPLIFIED

[@mansijain4258]

never seen sich a simplified video on a complicated topic. Thanks a lot. Learnt instantly from this. Way better than textbooks

[@saudahmed70]

Thanks for sharing your knowledge and expertise about IFRS 15. Having you as an instructor is a pleasure because you are very engaging and knowledgeable.

[@RVinay-oy2ny]

Really such a crisp and wonderful explanation, Madam. Thank you so much once again😊

[@jenniferlim2250]

Concise and clear. Danke! 👍

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As always, Awesome content. Thank you so much.

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This one's really helpful. Thankyou

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Short and sweet

[@COBBLEist]

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Much appreciated ♥

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Thank You!

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Nice！

[@GamingThunders]

Amazing video..but can you please clear my confusion with what will be the value of cost of sales and the inventory?

[@saverykong2149]

Good afternoon Silvia! Could you explain the amendment of IAS 12 ?

[@raghuramc1536]

On the contract asset, if we have a sale of goods in 2021 and receiving payment in 2023. Assuming interest of 10 % outside market. Do we need to record initial recognition as Dr Contract asset Cr sale or Dr Accounts receivable Cr Sale

[@user-gs8jc5dr8h]

Thank you very much! May I also know the journal entries at the contract starts. Why is it debit to contract asset but not cash? how shall we put the double entries for receiving cash? is there a contract liabilities?

[@CPDbox]

Because when the contract starts, the company does not receive any cash. The cash will be received of 100 paid monthly. And so, when this is received, the journal entry is Debit Cash / Credit Trade receivables (please revise the last entry in this video, where the trade receivables are recognized).

[@jatinsaini862]

cost of sales Dr To Inventory. The amount in this entry would be 300? or something else

[@hemanthkoundinyakasi4762]

Actual Cost of the phone set.

[@s.c.iimmograndest6705]

Is possible to recognise revenue in the case of an agreement for services, despite contract has been not yet signed? (but service is already provided)

[@CPDbox]

The contract does not necessarily need to be in written format, as soon as other types are accepted. The definition in IFRS 15 refers to contract being an agreement between 2 or more parties creating enforceable obligations - so the question is: If that contract is not signed, but services were provided, is the payment from customers for these services enforceable or not?