Receipts from contracts are credited to unearned service contract revenue.
Q: Direct Materials Purchases Budget: Direct Labor Budget Crescent Company produces stuffed toy…
A: Budgets are the estimates or forecasts made for future period. Production budget, material cost…
Q: Assume the following information for one of a company's variable expenses: • The actual amount of…
A: A variance is a difference between actual amount and budgeted or planned or standard amount. The…
Q: The University of Cincinnati Center for Business Analytics is an outreach center that collaborates…
A: Fees for the Symposium = $70 per person Rental cost for auditorium = $150 Registration processing…
Q: *You can't use Excel or any other software to solve the problems. Problem 1: A small used delivery…
A: 1.Straight line method : Under this depreciation method a fixed amount of depreciation is charged…
Q: What is the amount of capitalizable borrowing cost? (Use 3 decimal places for capitalization rate.)
A: Capitalized borrowing cost is the cost which is added to the cost of the asset which has been made…
Q: Direct Materials Purchases Budget: Direct Labor Budget Crescent Company produces stuffed toy…
A: Desired ending inventory for fabric = 20% of following month Production. Beginning inventory for…
Q: nnel uses tenan
A: Total cost of production of a good comprises of the total fixed cost of production and the total…
Q: Lena is a sole proprietor. In April of this year, she sold equipment purchased four years ago for…
A: Gain on equipment sale = selling price - Adjusted basis For first equipment = 17000 - 15500 = 1500
Q: Complete FLASH TRUCKING SERVICES WORKSHEET FOR THE MONTH ENDED DECEMBER 31, 2014
A: Worksheet is 10 column sheet which first shows unadjusted general ledger balances, adjustment…
Q: hè Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a…
A: Solution 1: Impact on net income on discontinuing racing bike Particulars Current Total…
Q: On December 10, Daniel Co. split its stock 5-for-2 when the market value was $65 per share.Prior to…
A: Split of Shares/Stock: When an organization splits the shares, it increases the number of shares of…
Q: 4. If the balance of the Building account was P1,400,000 and P300,000 of Accounts Payable were paid…
A: Financial accounting refers to the type of accounting which is primarily used by the outsiders to…
Q: THIRTYFIRST Company must determine the December 31, 2021 year end accruals for advertising and rent…
A: The accrued liabilities are the amount due to be paid within one year.
Q: To arrive at the accumulated taxable income, which of the following items does not represent a…
A: We have to find which one is not a positive adjustment in computing the accumulated taxable income.
Q: Henredon purchased a high precision programmable router for shaping furniture components for $85000.…
A: The income taxes are the tax liability to be paid on the income earned by the taxpayers. The…
Q: 1. Sales on account were $548,000. The beginning receivables balance was $128,000 and the ending…
A: The question is based on the concept of Cash flow statement. Cash flow statement is the statement…
Q: Recorded an adjusting journal entry for the portion of insurance coverage
A: Adjusting entry means where some adjustment need to be made at the end of specified period for…
Q: 4) Matiere Co. completed the following transactions during 2019 and 2020: Date Transactions 2019…
A: Bad Debts are those debt from which business has made credit sales in past and amount has not been…
Q: Valuing Inventory Using Lower-of-Cost-or-Net Realizable Value Printer Inc. discloses the following…
A: GIVEN Valuing Inventory Using Lower-of-Cost-or-Net Realizable Value Printer Inc. discloses the…
Q: onvention formula
A: A day-count convention is used to calculate the interest accrues on different investments such as…
Q: Amortizing Software Development Costs During 2020, the E-Software Company capitalized computer…
A: Amortization expense is the reduction in the value of intangible asset over the life of the asset.…
Q: The following balance sheet is for X Company: Balance Sheet January 1, 2021 Assets Equities Cash…
A: Answer:- Balance sheet definition:- A balance sheet can be defined as a statement that shows a…
Q: Tennies Clinic uses client-visits as its measure of activity. During November, the clinic budgeted…
A: A spending variance is the difference between an expense's actual and expected (or planned) amount.…
Q: On June 1, 2017, Santos Furniture Co. borrowed P5,000,000 (face value) from Sonic Co., a major…
A: Answer - Working Note : Computation of Discount on Note Payable : = Borrowed amount - (borrowed…
Q: Selected accounts are listed below. How much is the firm's operating income? accrued payroll $2,000…
A: Operating income is one of the measure of profitability of the business. This is calculated by…
Q: obtain 20X5 accrual basis net income, should these decreases be added to or deducted from cash basis…
A: Accrual basis income is the income which has been earned by the company or the business during the…
Q: 1) Prepare a 10 - column worksheet as at December 31. 2) Journalize Your adjustments 3)…
A:
Q: On December 31, 2016, Agro Company agreed to the following modification of its existing liability:…
A: Debt restructuring is a technique under which the terms of the loan are changed by the consent of…
Q: A debt amortization schedule prepared for each debt and equity is considered a good control. O True…
A: Debt Amortization Schedule: A loan amortisation schedule is a comprehensive table of periodic loan…
Q: Bond Info: Coupon Rate 11.875% Quoted Yield 3.000% Maturity Date May 29, 2023 Frequency 2 Tax Rate…
A: On each bond there is periodic coupon payment and these are to be paid each period to the person…
Q: Timothy Donaghy has developed a unique formula for growing hair. His proprietary lotion, used…
A: The variable costs are the costs which remains constant for per unit cost but in total changes with…
Q: Sales P1.000.000 Cost of Sales - PS00,000 Rental Expenses - P50,000 Salaries Expenses - P40,000…
A: Introduction: Income statement: All the revenue and expenses items are to be shown in income…
Q: 1)Chester Company reported payroll for the month of January 2022 as follows: Total Wages Income…
A: The payroll tax liability is the total amount of the tax that is company liable for before any…
Q: workin g coPital The following information was taken from the balance sheet of Aglugub Cash P13 250…
A: Difference between the Total Current Assets and Total Current liabilities is called Working Capital.…
Q: Concord, Inc. is unsure of whether to sell its product assembled or unassembled. The unit cost of…
A: Given information, •Un-assembled product: Cost= $13 Selling price= $54 •Assembled product:…
Q: A car is purchased at $18,000. The car depreciates by $800 each year. When would the car be worth…
A: Lets understand the basics. Depreciation is a reduction in value of asset due to wear and tear,…
Q: Which of the following statements is true of a trial balance? O A. A trial balance is the first step…
A: Trial balance means the statement prepared from ledger account where all debit and credit balance…
Q: How many actual direct labor-hours were worked?
A: Direct labor efficiency variance The difference between actual time incurred to manufacture a…
Q: Olympus, Inc., manufactures three models of mattresses: the Sleepeze, the Plushette, and the Ultima.…
A: Activity based budgeting refers to the method of budgeting under which the various activities are…
Q: 5. Assume that a partnership had assets with a book value of P240,000 and a market value of…
A: Liquidation of Partnership Firm: Liquidation of the Partnership firm means dissolution of the the…
Q: Dividends Per Share Lightfoot Inc., a software development firm, has stock outstanding as…
A: Cumulative Preference dividend - Cumulative Preference dividend is the dividend which is…
Q: On January 1, 2021, Pepita Corporation purchased 25% of the outstanding voting shares of Pablito…
A: These are the accounting transactions that are having a monetary impact on the financial statement…
Q: Melanio Company produces a merchandise that has the following data: P80 per unit P48 per unit…
A: Marginal Costing - Marginal Costing is the method of computing operating profit by bifurcating…
Q: Exercise 9-21 Complete the accounting cycle using long-term liability transactions (LO9-2, 9-8) (The…
A: Journal Entries - Journal Entries are the recording of transactions of the organization. It is…
Q: Marketing Expense Budget Timothy Donaghy has developed a unique formula for growing hair. His…
A: A budget is a forecast of revenue and expenses for a certain future period of time that is generally…
Q: Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or…
A: Direct Material quantity variance = (Actual quantity used×Standard price) - (Standard quantity…
Q: The stockyholder's section of the balance sheet contains such as the following . Common stock .…
A: Since you have posted a question with multiple sub-parts, we will do the first three sub-parts for…
Q: Stevie D. contributed property to Animal Corp, an S-Corporation, with a FMV of $50,000 and a basis…
A: Introduction S Corporation shareholder's are not allowed to deduct losses in excess of their stock…
Q: TEN Company provides extended service contracts on equipment sold through major retailers. The…
A: Liabilities are the obligations and dues which needs to be settled by the business. These can be…
Q: What are three of the benefits of common-sized analysis using the inverse operating asset turnover…
A: Common sized analysis evaluates the performance of business by presenting the percentage of the line…
Fajardo Company sells appliance service contracts agreeing to repair appliance for 2-year period. Fajardo Company’s past experience is that, of the total amount for repairs on service contracts, 40% is incurred evenly during the 1st contract year and 60% evenly during the second contract year. Receipts from service contracts for the 2 years ended December 31, 2021, are as follows: 2020, P500,000; 2021, P600,000. Receipts from contracts are credited to unearned service contract revenue.
Assume that all contract sales are made evenly during the year.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- JustKitchens Inc. provides services to restaurants and hotels. The company supplies paper products, tableware, cookware, restaurant and kitchen equipment, and cleaning supplies. On January 2, 2019, Just-Kitchens enters into a contract with a local restaurant chain to provide its services for 3 years at a cost of 10,000 per year. The restaurant chain pays the total contract fee on January 2, 2019. JustKitchenss stand-alone selling price is also 10,000 per year. After 2 years, the restaurant asks to modify the contract. On January 2, 2021, the companies agree to reduce the fee for the third year to 9,000 in exchange for extending the contract for 2 additional years at a fee of 11,000 per year. This modification is agreed to by both parties, and on that date the restaurant chain pays for the additional 2 years of service. The 11,000 fee for the additional years is the same as JustKitchenss stand-alone price. Required: 1. How should JustKitchens account for the contract modification? 2. Prepare the journal entry that JustKitchens would make over the life of the contract.On January 1, 2019, Mopps Corp. agrees to provide Conklin Company 3 years of cleaning and janitorial services. The contract sets the price at 12,000 per year, which is the normal standalone price that Mopps charges. On December 31, 2020, Mopps and Conklin agree to modify the contract. Mopps reduces the fee for the third year to 10,000, and Conklin agrees to a 4-year extension that will extend services through December 31, 2024, at a price of 15,000 per year. At the time that the contract is modified, Mopps is charging other customers 13,500 for the cleaning and janitorial service. Required: Should Mopps and Conklin treat the modification as a separate contract? If so how should Mopps account for the contract modification on December 31, 2020? Support your opinion by discussing the application to this case of the factors that need to be considered for determining the accounting for contract modifications.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?
- Rix Company sells home appliances and provides installation and service for its customers. On April 1, 2019, a customer purchased a dishwasher that Rix normally sells for 1,000. In addition, the customer purchased the installation service and a 3-year service contract, with stand-alone selling prices of 200 and 400, respectively. Because the customer purchased all three items as a bundle, Rix charged the customer 1,400. Required: 1. How should the transaction price be allocated among the products? 2. Prepare the journal entries to recognize revenue related to each product in 2019.Koolman Construction Company began work on a contract in 2019. The contract price is 3,000,000, and the company determined that its performance obligation was satisfied over time. Other information relating to the contract is as follows: Required: 1. Compute the gross profit or loss recognized in 2019 and 2020. 2. Prepare the appropriate sections of the income statement and ending balance sheet for each year.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.