Consider the following situations for Shocker: 1. On November 28, 2024, Shocker received a $2,250 payment from a customer for services to be rendered evenly over the next three months. Deferred Revenue was credited on November 28. 2. On December 1, 2024, the company paid a local radio station $2,250 for 30 radio ads that were to be aired, 10 per month, throughout December, January, and February. Prepaid Advertising was debited on December 1. 3. Employee salaries for the month of December totaling $6,500 will be paid on January 7, 2025. 4. On August 31, 2024, Shocker borrowed $55,000 from a local bank. A note was signed with principal and 9% interest to be paid on August 31, 2025. Required: Iba

Consider the following situations for Shocker: 1. On November 28, 2024, Shocker received a $2,250 payment from a customer for services to be rendered evenly over the next three months. Deferred Revenue was credited on November 28. 2. On December 1, 2024, the company paid a local radio station $2,250 for 30 radio ads that were to be aired, 10 per month, throughout December, January, and February. Prepaid Advertising was debited on December 1. 3. Employee salaries for the month of December totaling $6,500 will be paid on January 7, 2025. 4. On August 31, 2024, Shocker borrowed $55,000 from a local bank. A note was signed with principal and 9% interest to be paid on August 31, 2025. Required: Iba

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

The accountant for Eastern Appliances manages the “no money down” arrangements offered to its customers. A customer purchased a refrigerator normally priced at $1,284.53 with all taxes included. Using a required rate of return of 9% compounded quarterly, the accountant determined that, after a deferral period, the customer should make 12 monthly payments of $119.16, with the first payment due on November 1, 2020. On what date was the refrigerator purchased?
On November 1, 2022, SAN JOSE receives an order from a customer for a computer as well as 12 months of technical support. The company delivers the computer to customer on same day (Dec 1). The customer paid the P 50,400 upfront. The computer sells for P 36,000- standalone price.What is the total revenue to be recognized at Dec. 31, 2022?
[The following information applies to the questions displayed below.] Hitzu Company sold a copier (that costs $6,500) for $13,000 cash with a two-year parts warranty to a customer on August 16 of Year 1. Hitzu expects warranty costs to be 4% of dollar sales. It records warranty expense with an adjusting entry on December 31. On January 5 of Year 2, the copier requires on-site repairs that are completed the same day. The repairs cost $138 for materials taken from the parts inventory. These are the only repairs required in Year 2 for this copier. 1. How much warranty expense does the company report for this copier in Year 1? 2. How much is the estimated warranty liability for this copier as of December 31 of Year 1? 3. How much is the estimated warranty liability for this copier as of December 31 of Year 2? 4. Prepare journal entries to record (a) the copier's sale; (b) the adjustment to recognize the warranty expense on December 31 of Year 1; and (c) the repairs that occur on January 5…
[The following information applies to the questions displayed below.] Hitzu Company sold a copier (that costs $6,500) for $13,000 cash with a two-year parts warranty to a customer on August 16 of Year 1. Hitzu expects warranty costs to be 4% of dollar sales. It records warranty expense with an adjusting entry on December 31. On January 5 of Year 2, the copier requires on-site repairs that are completed the same day. The repairs cost $138 for materials taken from the parts inventory. These are the only repairs required in Year 2 for this copier. 1. How much warranty expense does the company report for this copier in Year 1? 2. How much is the estimated warranty liability for this copier as of December 31 of Year 1? 3. How much is the estimated warranty liability for this copier as of December 31 of Year 2? 4. Prepare journal entries to record (a) the copier's sale; (b) the adjustment to recognize the warranty expense on December 31 of Year 1; and (c) the repairs that occur on January 5…
Mr X enrolls in a 12-month customer service assistance program for a computer software from CYBER COMPANY costing P1,200 per month on August 1, 20x8. Given that the computer assistance occurs evenly throughout the year, CYBER COMPANY uses the “proportion of time” as its measure for membership revenue, what is the amount of sales revenue to be recognized on December 31?
The Jingle Corporation had the following situations on December 2024. 1. On December 10, 2024, Jingle received a $4,400 payment from a customer and credited deferred service revenue. The services to the customer were completed by December 31, 2024. 2. On December 1, 2024, the company paid a local radio station $2,800 for 40 radio ads that were to be aired, 20 per month, throughout December and January. Prepaid advertising was debited at the time the advertising was paid. 3. Employee salaries for the month of December totaling $20,000 will be paid on January 7, 2025. 4. On August 31, 2024, Jingle borrowed $80,000 from a local bank. A note was signed with principal and 9% interest to be paid on August 31, 2025. Prepare the necessary adjusting entries at its year-end of December 31, 2024. No adjusting entries were recorded during the year. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal…
On November 1, Year 1, Hydra Corp sold 100 machines to a customer for $60 each. The cost of each machine is $20.Hydra allows customers to return any unused machine within 6 months and receive a full refund. The company reasonably estimates that 10 machines (seven in Year 1, three in Year 2) will be returned. What amount of net revenue is recognized from the sale of these machines in Year 1?
On July 10, 2023, Cullumber Ltd. sold GPS systems to retailers on account for a selling price of $1,080,000 (cost $864,000). Cullumber grants the right to return systems that do not sell in three months following delivery. Past experience indicates that the normal return rate is 15%. By October 11, 2023, following the collection on account, retailers returned systems to Cullumber and were granted credits of $89,000. The company follows IFRS. Prepare Cullumber's journal entries to record the $89,000 of actual returns on October 10, 2023. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. List all debit entries before credit entries.) Date Account Titles and Explanation Debit Credit ber 10, 2023 Refund Liability Accounts Payable (To record returns from customers) ber 10, 2023 Estimated Inventory Returns (To record return of inventory) ber 10,…
McElroy Inc., a marketing consulting firm, entered into the following three revenue contracts in March, 2021. 1. The contract with Customer A requries that McElroy Inc. provides 10 hours of consulting services at $300 per hour. 2. The contract with Customer B requires that McElroy, Inc. develops an electronic promotion of the customer's new product line. Payment for the services are equal to $6,000 plus 2% of the customer's sales over the one month promotion period. McElroy, Inc. estimates that there is a 30% chance of sales totaling $100,000, a 50% chance of sales totaling $150,000, and a 20% chance of sales totaling $200,000. 3. The contract with Customer C requires McElroy, Inc. to create a promotional mailing for its product for $8,000. McElroy Inc. will receive a bonus of $500 if the project is completed within 5 business days and a $250 bonus if the project is completed within 6 business days. Based on McElroy's estimate of the time to complete the project and status…
Sentry Transport Inc. of Atlanta provides in-town parcel delivery services in addition to a fullrange of passenger services. Sentry engaged in the following activities during the current year:a. Sentry received $5,000 cash in advance from Rich’s Department Store for an estimated 250deliveries during December 2019 and January and February of 2020. The entire amountwas recorded as unearned revenue when received. During December 2019, 110 deliverieswere made for Rich’s.b. Sentry operates several small buses that take commuters from suburban communities to thecentral downtown area of Atlanta. The commuters purchase, in advance, tickets for 50 onewayrides. Each 50-ride ticket costs $500. At the time of purchase, Sentry credits the cashreceived to unearned revenue. At year end, Sentry determines that 10,160 one-way rideshave been taken.c. Sentry operates several buses that provide transportation for the clients of a social service agencyin Atlanta. Sentry bills the agency quarterly at the…
Seacost Magazine sells subscriptions for $36 for 18 issues. The company collects cash in advance and then mails out the magazines to subscribers each Apply the revenue recognition principle to determine A. when seacost magazine should record revenue for this situation B. the amount fo revenue seacost magazine should record for eight issues
Purrfect Pets, Inc. provides animal daycare for $ 28 per day. Customers buy three month packages, which provide 15 days of care per month. In January they received cash payments from 12 customers. For the month of January, they will recognize ________ of revenue under the cash basis, and ________ of revenue under the accrual basis. A. $15,120;$5,040 B. $ 420; $1,260 C. $5,040;$5,040 D. $15,120;$15,120