On 1 January 20X1, Varenne delivered an industrial oven whose cash selling price is 300,000; the customer will pay 363,000 on 31 December 20X2. On delivery, Varenne recognised revenue and a receivable of 300,000. The rate of a separate financing transaction with this customer is 10% (case data); interest is computed on the opening balance of the receivable (teaching assumption). Record the entry at 31 December 20X1 relating to the financing.
- Cash selling price
- 300,000
- Promised consideration payable later
- 363,000
- Rate of a separate financing transaction with the customer
- 10 %