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Bogdan [553]
3 years ago
6

Kelly Corp. barters with Ace Corporation for goods that are similar in nature and value. The value of the goods was $1,000. The

cost of the goods was $400. If Kelly uses IFRS to prepare financial statements, what amount should Kelly recognize as income?a. $1,000
b. $0
c. $400
d. $600
Business
1 answer:
MArishka [77]3 years ago
4 0

Answer:

B. $0

Explanation:

The International Financial Reporting Standards (IFRS) specifically Internal Accounting Standards (IAS) 18 on revenue specifically states that where there is a barter transaction that is the exchange of goods or services, the transaction will not be recognized as one generating revenue when the goods or the services being exchanged are similar in nature. If it is not recognized as a revenue generating transaction then no revenue will be recognized as well

Since Kelly Corp barters goods with Ace Corporation established to be similar in nature , then according to IFRS Kelly cannot recognize any income on the transaction.

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The two major sources of energy were coal and oil that were used to power steam engines that moved machinery using water steam. That led to work specialization and urbanization (people moving into large urban areas).

The industrial revolution first started in northwestern Europe, but it then spread to the US, Russia and Japan. The global economy developed new patterns of global trade and production between nations that produced resources and those that processed them and produced goods.

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