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Current Attempt in Progress Crane Ltd. (CL) is a medical equipment supply company that sells, installs, and services a variety of mobility aid equipment. CL was founded in 2021 and has seen significant growth since then. CL's bookkeeper retired in July, and her replacement has asked for your assistance in recording the following transactions from the month of August 2024. Regular entries: Aug. 1 1 6 13 20 30 CL purchased a new delivery truck for $106,650, paying $59,250 cash and financing the balance using a note payable at 2% per annum. The note payable is due in 12 months, and interest on the note must be paid on the first day of every month, beginning on September 1, 2024. CL's management has determined that the truck will have a useful life of six years and a residual value of $21,330. CL paid $7,310 for an insurance policy on the new truck for the period August 1, 2024, to December 31, 2025. CL sold $42,660 of medical equipment, of which 50% was on account and the balance was cash. The cost to CL of the products sold was $14,800. The company purchased inventory on credit at a cost of $18,960. Golden Years Retirement Group (Golden), one of CL's largest customers, signed an equipment installation and service contract with CL. The contract runs from September 1, 2024, to August 30, 2025, and will mean that CL services all of Golden's medical equipment. In accordance with the contract terms, Golden paid CL $11,850, representing four months' service revenue under the contract. CL paid dividends in the amount of $29,625, which had been declared by the board (and recorded) in July 2024. Adjusting entries: Q Search

Current Attempt in Progress Crane Ltd. (CL) is a medical equipment supply company that sells, installs, and services a variety of mobility aid equipment. CL was founded in 2021 and has seen significant growth since then. CL's bookkeeper retired in July, and her replacement has asked for your assistance in recording the following transactions from the month of August 2024. Regular entries: Aug. 1 1 6 13 20 30 CL purchased a new delivery truck for $106,650, paying $59,250 cash and financing the balance using a note payable at 2% per annum. The note payable is due in 12 months, and interest on the note must be paid on the first day of every month, beginning on September 1, 2024. CL's management has determined that the truck will have a useful life of six years and a residual value of $21,330. CL paid $7,310 for an insurance policy on the new truck for the period August 1, 2024, to December 31, 2025. CL sold $42,660 of medical equipment, of which 50% was on account and the balance was cash. The cost to CL of the products sold was $14,800. The company purchased inventory on credit at a cost of $18,960. Golden Years Retirement Group (Golden), one of CL's largest customers, signed an equipment installation and service contract with CL. The contract runs from September 1, 2024, to August 30, 2025, and will mean that CL services all of Golden's medical equipment. In accordance with the contract terms, Golden paid CL $11,850, representing four months' service revenue under the contract. CL paid dividends in the amount of $29,625, which had been declared by the board (and recorded) in July 2024. Adjusting entries: Q Search

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter17: Advanced Issues In Revenue Recognition
Section: Chapter Questions
Problem 5P
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Current Attempt in Progress Crane Ltd. (CL) is a medical equipment supply company that sells, installs, and services a variety of mobility aid equipment. CL was founded in 2021 and has seen significant growth since then. CL's bookkeeper retired in July, and her replacement has asked for your assistance in recording the following transactions from the month of August 2024. Regular entries: Aug. 1 1 6 13 20 30 CL purchased a new delivery truck for $106,650, paying $59,250 cash and financing the balance using a note payable at 2% per annum. The note payable is due in 12 months, and interest on the note must be paid on the first day of every month, beginning on September 1, 2024. CL's management has determined that the truck will have a useful life of six years and a residual value of $21,330. CL paid $7,310 for an insurance policy on the new truck for the period August 1, 2024, to December 31, 2025. CL sold $42,660 of medical equipment, of which 50% was on account and the balance was cash. The cost to CL of the products sold was $14,800. The company purchased inventory on credit at a cost of $18,960. Golden Years Retirement Group (Golden), one of CL's largest customers, signed an equipment installation and service contract with CL. The contract runs from September 1, 2024, to August 30, 2025, and will mean that CL services all of Golden's medical equipment. In accordance with the contract terms, Golden paid CL $11,850, representing four months' service revenue under the contract. CL paid dividends in the amount of $29,625, which had been declared by the board (and recorded) in July 2024. Adjusting entries: Q Search
Transcribed Image Text:Current Attempt in Progress Crane Ltd. (CL) is a medical equipment supply company that sells, installs, and services a variety of mobility aid equipment. CL was founded in 2021 and has seen significant growth since then. CL's bookkeeper retired in July, and her replacement has asked for your assistance in recording the following transactions from the month of August 2024. Regular entries: Aug. 1 1 6 13 20 30 CL purchased a new delivery truck for $106,650, paying $59,250 cash and financing the balance using a note payable at 2% per annum. The note payable is due in 12 months, and interest on the note must be paid on the first day of every month, beginning on September 1, 2024. CL's management has determined that the truck will have a useful life of six years and a residual value of $21,330. CL paid $7,310 for an insurance policy on the new truck for the period August 1, 2024, to December 31, 2025. CL sold $42,660 of medical equipment, of which 50% was on account and the balance was cash. The cost to CL of the products sold was $14,800. The company purchased inventory on credit at a cost of $18,960. Golden Years Retirement Group (Golden), one of CL's largest customers, signed an equipment installation and service contract with CL. The contract runs from September 1, 2024, to August 30, 2025, and will mean that CL services all of Golden's medical equipment. In accordance with the contract terms, Golden paid CL $11,850, representing four months' service revenue under the contract. CL paid dividends in the amount of $29,625, which had been declared by the board (and recorded) in July 2024. Adjusting entries: Q Search
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