IAS 2 Example Contractual volume rebates provides an example calculation with regard to the costs of inventory in combination with contractual volume rebates.
On 1 January 20X1 Entity A, a retailer, enters into a 2-year contract with a supplier of product X. Under the agreement, Entity A purchases product X for $100 per item. The agreement provides that Entity A will receive a $5 rebate for each purchased item (applied retrospectively to all purchases) if it purchases at least 10,000 products over the 2-year contract term. On 1 January 20X1, Entity A purchased 6,000 products. Sales to customers were 5,500 (Q1 1,150, Q2 1,250, Q3 1,450, Q4 1,650), the sales price was increased every quarter with $2/product, starting … Read more