On 15 June 20X1, Vélinor sells 1,000 units scooters for cash at a unit price of 250. Customers have a 30-day right of return with a full refund. Based on its history, Vélinor estimates that 5 % of the scooters will be returned; according to the case data, it is highly probable that this estimate will not result in a significant reversal of the revenue recognised. Calculate the revenue and the refund liability to be recognised at the date of sale.
- Number of scooters sold
- 1,000
- Unit selling price
- 250
- Expected return rate
- 5 %