CERTYNEX IFRS ACADEMY

Calisse sells 500 coffee makers with a 60-day right of return and expects some of them to be returned. What does it recognise when control of the coffee makers is transferred to the customers?

Revenue for the full invoiced price and a provision recognised as an expense for the expected returns.

Revenue excluding expected returns, a refund liability and an asset for the right to recover the products, with an adjustment to cost of sales.

No revenue until the 60-day return period has expired.

Revenue excluding expected returns and a refund liability, with the whole carrying amount of the coffee makers delivered removed from inventory and charged to cost of sales.