Shamrock Ranch & Farm is a distributor of ranch and farm equipment. Its products range from small tools, power equipment for trench-digging and fencing, grain dryers, and barn winches. Most products are sold direct via its company catalog and Internet site. However, given some of its specialty products, select farm implement stores carry Shamrock's products. Pricing and cost information on three of Shamrock's most popular products are as follows. Mini-trencher Power fence hole auger Grain/hay dryer Item (a) Respond to the requirements related to the following independent revenue arrangements for Shamrock Ranch & Farm. Standalone Selling Price (Cost) $3,700 ($1,900 ) (800) 15,400 (10,100) 1,100 On January 1, 2020, Shamrock sells 30 augers to Mills Farm & Fleet for $33,000. Mills signs a 6-month note at an annual interest rate of 12%. Shamrock allows Mills to return any auger that it cannot use within 60 days and receive a full refund. Based on prior experience, Shamrock estimates that 5% of units sold to customers like Mills will be returned (using the most likely outcome approach). Shamrock's costs to recover the products will be immaterial, and the returned augers are expected to be resold at a profit. Prepare the journal entry for Shamrock on January 1, 2020. (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.) (To record sales) Account Titles and Explanation (b) (To record cost of goods sold) Debit Credit On August 10, 2020, Shamrock sells 17 mini-trenchers to a farm co-op in western Minnesota on account. Shamrock provides a 4% volume discount on the mini-trenchers if the co-op has a 15% increase in purchases from Shamrock compared to the prior year. Given the slowdown in the farm economy, sales to the co-op have been flat, and it is highly unlikely that the benchmark will be met. Prepare the journal entry for Shamrock on August 10, 2020. (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.)

Shamrock Ranch & Farm is a distributor of ranch and farm equipment. Its products range from small tools, power equipment for trench-digging and fencing, grain dryers, and barn winches. Most products are sold direct via its company catalog and Internet site. However, given some of its specialty products, select farm implement stores carry Shamrock's products. Pricing and cost information on three of Shamrock's most popular products are as follows. Mini-trencher Power fence hole auger Grain/hay dryer Item (a) Respond to the requirements related to the following independent revenue arrangements for Shamrock Ranch & Farm. Standalone Selling Price (Cost) $3,700 ($1,900 ) (800) 15,400 (10,100) 1,100 On January 1, 2020, Shamrock sells 30 augers to Mills Farm & Fleet for $33,000. Mills signs a 6-month note at an annual interest rate of 12%. Shamrock allows Mills to return any auger that it cannot use within 60 days and receive a full refund. Based on prior experience, Shamrock estimates that 5% of units sold to customers like Mills will be returned (using the most likely outcome approach). Shamrock's costs to recover the products will be immaterial, and the returned augers are expected to be resold at a profit. Prepare the journal entry for Shamrock on January 1, 2020. (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.) (To record sales) Account Titles and Explanation (b) (To record cost of goods sold) Debit Credit On August 10, 2020, Shamrock sells 17 mini-trenchers to a farm co-op in western Minnesota on account. Shamrock provides a 4% volume discount on the mini-trenchers if the co-op has a 15% increase in purchases from Shamrock compared to the prior year. Given the slowdown in the farm economy, sales to the co-op have been flat, and it is highly unlikely that the benchmark will be met. Prepare the journal entry for Shamrock on August 10, 2020. (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.)

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter9: Standard Costing: A Functional-based Control Approach

Section: Chapter Questions

Problem 12E: Quincy Farms is a producer of items made from farm products that are distributed to supermarkets....

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