Which accounting standard governs the recognition of revenue?
Practice Questions
Q1
Which accounting standard governs the recognition of revenue?
IAS 1
IFRS 15
IAS 2
IFRS 9
Questions & Step-by-Step Solutions
Which accounting standard governs the recognition of revenue?
Step 1: Understand that revenue recognition is about when a company can record its sales in its financial statements.
Step 2: Learn that IFRS 15 is the specific accounting standard that provides rules for recognizing revenue.
Step 3: Know that IFRS 15 applies to contracts with customers and explains how to determine when to recognize revenue.
Step 4: Remember that IFRS 15 outlines a five-step process to recognize revenue, which includes identifying the contract, performance obligations, transaction price, allocating the price, and recognizing revenue when obligations are satisfied.
