Danger Ltd Writes Insurance Policies to Cover the Risk of Theft

Danger Ltd writes insurance policies to cover the risk of theft in central Brisbane.The policy premiums are expected to be received evenly over the year as they have evenly distributed due dates.Danger Ltd is aware that the risk of theft is 20 times higher in March and 15 times higher in July than in the other months of the year.The appropriate discount rate for Danger Ltd is 15%.If the total amount of insurance premiums to be received is $1 000 000,what is the pattern of revenue recognition in accordance with AASB 1023 (round amounts to the nearest dollar) ?

A) $72 467 per month
B) $200 000 in March, $150 000 in July, $54 167 in each other month
C) $83 333 per month.
D) $444 444 in March, $333 333 in July and $22 222 in each other month