Early In 2021, the Excalibur Company began developing a new software package to be marketed. The project was completed in December 2021 at a cost of $13 million. Of this amount, $10 million was spent before technological feasibility was established. Excalibur expects a useful life of five years for the new product with total revenues of $16 million. During 2022, revenue of $4 million was recognized. Required: Prepare a journal entry to record the 2021 development costs. (If no entry is required for a transaction/event, select "No Journal entry required" In the first account fleld. Enter your answers in whole dollar not in millions.)

Early In 2021, the Excalibur Company began developing a new software package to be marketed. The project was completed in December 2021 at a cost of $13 million. Of this amount, $10 million was spent before technological feasibility was established. Excalibur expects a useful life of five years for the new product with total revenues of $16 million. During 2022, revenue of $4 million was recognized. Required: Prepare a journal entry to record the 2021 development costs. (If no entry is required for a transaction/event, select "No Journal entry required" In the first account fleld. Enter your answers in whole dollar not in millions.)

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter26: Capital Budgeting (capbud)

Section: Chapter Questions

Problem 5R

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On March 1, 2019, Elkhart enters into a new contract to build a specialized warehouse for 7 million. The promise to transfer the warehouse is determined to be a performance obligation. The contract states that if the warehouse is usable by November 30, 2019, Elkhart will receive a bonus of 600,000. For every week after November 30 that the warehouse is not usable, the bonus will decrease by 150,000. Elkhart provides the following completion schedule: Required: 1. Assume that Elkhart uses the expected value approach. What amount should Elkhart use for the transaction price? 2. Assume that Elkhart uses the most likely amount approach. What amount should Elkhart use for the transaction price? 3. Next Level What is the purpose of assessing whether a constraint on the variable consideration exists?
During 2019, R Corp., a manufacturer of chocolate candies, contracted to purchase 100,000 pounds of cocoa beans at 1.00 per pound, delivery to be made in the spring of 2020. Because a record harvest is predicted for 2020, the price per pound for cocoa beans had fallen to 0.80 by December 31, 2019. Of the following journal entries, the one that would properly reflect in 2019 the effect of the commitment of R Corp. to purchase the 100,000 pounds of cocoa is:
Early in 2021, the Excalibur Company began developing a new software package to be marketed. The project was completed in December 2021 at a cost of $6 million. Of this amount, $4 million was spent before technological feasibility was established. Excalibur expects a useful life of five years for the new product with total revenues of $10 million. During 2022, revenue of $3 million was recognized.Required:Prepare a journal entry to record the 2021 development costs.
Micropolis Technology began a new development project in 2020. The project reached technological feasibility on September 1, 2021, and was available for release to customers at the beginning of 2022. Development costs incurred prior to September 1, 2021, were $4,560,000, and costs incurred from June 30 to the product release date were $1,920,000. The 2022 revenues from the sale of the new software were $3,950,000, and the company anticipates additional revenues of $11,850,000. The economic life of the software is estimated at three years. Amortization of the software development costs for the year 2022 would be:
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