Huawey Company, a telco operator, entered into a contract with Badjyang on Feb. 1, 2019. In line with the contract, Badjyang subscribes for a monthly plan for 12 months and in return receives a free handset model 2019. Badjyang will pay a monthly fee of P1,800 starting Feb. 28, 2019 The standalone selling price of Huawey handset model 2019 is P6,000 and the monthly plans for P1,500 a month without the handset. 10. The amount of receivable recorded on Feb. 28, 2019 P1,500 P1,800 а. PO С. b. P1,350 d. 11. The total revenue for the period ended Dec. 31, 2019 amounted to: P20,250 d. P27,600 a. PO с. b. P24,000

Huawey Company, a telco operator, entered into a contract with Badjyang on Feb. 1, 2019. In line with the contract, Badjyang subscribes for a monthly plan for 12 months and in return receives a free handset model 2019. Badjyang will pay a monthly fee of P1,800 starting Feb. 28, 2019 The standalone selling price of Huawey handset model 2019 is P6,000 and the monthly plans for P1,500 a month without the handset. 10. The amount of receivable recorded on Feb. 28, 2019 P1,500 P1,800 а. PO С. b. P1,350 d. 11. The total revenue for the period ended Dec. 31, 2019 amounted to: P20,250 d. P27,600 a. PO с. b. P24,000

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 19E: Rix Company sells home appliances and provides installation and service for its customers. On April...

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On October 1, 2019, Grahams WeedFeed Inc. signs a contract to maintain the grounds for BigData Corp. The contract ends on March 31, 2020, and has a monthly payment of 3,200. The contract does not include any stipulations for additional periods. On June 1, Grahams WeedFeed and BigData sign a new 12-month contract that is retroactive to April 1, 2020. The monthly fee for the new contract is 4,000 per month and is also retroactive to April 1, 2020. During April and May of 2020, while the new contract was being negotiated, Grahams Weed Feed continued to maintain the grounds, and BigData continued to pay 3,200 per month. BigData was satisfied with Grahams WeedFeeds performance, and the only issue during negotiations was the monthly fee. Required: Determine if a valid contract exists between Grahams WeedFeed and BigData during April and May 2020.
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On January 1, 2019, Loud Company enters into a 2-year contract with a customer for an unlimited talk and 5 GB data wireless plan for $70.00 per month. The contract includes a smartphone for which the customer pays $299.00. Loud also sells the smartphone and monthly service plan separately, charging $659.00 for the smartphone and $70.00 for the monthly service for the unlimited talk and 5 GB data wireless plan. On July 1, 2019, the customer realizes that she needs less data in her wireless plan and downgrades to the unlimited talk and 2 GB data plan for the remaining term of the contract (18 months). The unlimited talk and 2 GB data plan is priced at $49.00 per month. The $49.00 per month is Loud’s current stand-alone price for this plan that is available to all customers. Required: 1. How should Loud account for this contract modification? 2. Provide Loud’s new monthly revenue recognition journal entry. 1. How should Loud account for this contract modification? The…