Skip to content

CMA Final · Corporate Financial Reporting · Revenue from Contracts with Customers (Ind AS 115)

Prakash Auto Ltd's statement of profit and loss for the year shows revenue from contracts with customers of Rs 480 lakh, of which Rs 36 lakh is excise duty included in that revenue, and interest income on bonds of Rs 12 lakh from other sources. What must be disclosed or presented according to Ind AS 115?

Revenue from contracts with customers of Rs 480 lakh must be disclosed separately from the Rs 12 lakh of other revenue, and the Rs 36 lakh excise duty included in that revenue must be presented separately. Combining or adjusting these figures would breach the Ind AS 115 presentation requirements.

  1. AOnly a single revenue figure of Rs 492 lakh, since all revenue is combined
  2. BRevenue from contracts with customers of Rs 480 lakh shown separately from other revenue of Rs 12 lakh, and the Rs 36 lakh excise duty included in revenue presented separatelyCorrect
  3. CRevenue of Rs 444 lakh after deducting excise duty, with excise duty not presented
  4. DRevenue from contracts with customers of Rs 516 lakh, adding excise duty to the amount recognised

Explanation

Paragraph 113(a) requires revenue from contracts with customers to be disclosed separately from other sources of revenue, so Rs 480 lakh is shown apart from Rs 12 lakh. Paragraph 109AA requires the excise duty included in revenue (Rs 36 lakh) to be presented separately. Netting off excise or adding it again is wrong because the Rs 480 lakh already includes it.

Did you get it right without looking?

One question tells you little. A timed set on Revenue from Contracts with Customers (Ind AS 115) shows your real accuracy, how long you take and where you lose marks.

Practise Revenue from Contracts with Customers (Ind AS 115)Free diagnostic mock

More Revenue from Contracts with Customers (Ind AS 115) questions