Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
16th Edition
ISBN: 9780134475585
Author: Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
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Chapter 1, Problem 1.4Q
Describe the business functions in the value chain.
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On March 10, 2025, Carla Vista Company sold to Vaughn Hardware 220 tool sets at a price of $55 each (cost $29 per set) with terms
of n/60, f.o.b. shipping point. Carla Vista allows Vaughn to return any unused tool sets within 60 days of purchase. Carla Vista
estimates that (1) 10 sets will be returned, (2) the cost of recovering the products will be immaterial, and (3) the returned tools sets
can be resold at a profit. On March 25, 2025, Vaughn returned 7 tool sets and received a credit to its account.
(a)
Prepare journal entries for Carla Vista to record (1) the sale on March 10, 2025, (2) the return on March 25, 2025, and (3) any
adjusting entries required on March 31, 2025 (when Carla Vista prepares financial statements). Carla Vista believes the original
estimate of returns is correct. (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 O for the amounts.…
Cullumber Company sells goods on credit that cost $301,000 to Mark Company for $402,000 on January 2, 2025. The sales price
includes an installation fee, which has a standalone selling price of $37,000. The standalone selling price of the goods is $365,000. The
installation is considered a separate performance obligation and is expected to take 6 months to complete.
Date
Account Titles and Explanation
Jan. 2, 2025
Accounts Receivable
Sales Revenue
Unearned Service Revenue
(To record sales on account)
Jan. 2, 2025
Cost of Goods Sold
(b).
Inventory
(To record cost of goods sold)
Debit
402000
301000
Credit
365000
37000
301000
Cullumber prepares an income statement for the first quarter of 2025, ending on March 31, 2025 (installation was completed on
June 18, 2025). How much revenue should Cullumber recognize related to its sale to Mark?
First Quarter
Sales revenue
$
Cost of goods sold
Gross profit
$
LA
Cullumber Company sells goods on credit that cost $301,000 to Mark Company for $402,000 on January 2, 2025. The sales price
includes an installation fee, which has a standalone selling price of $37,000. The standalone selling price of the goods is $365,000. The
installation is considered a separate performance obligation and is expected to take 6 months to complete.
(a)
Prepare the journal entries (if any) to record the sale on January 2, 2025. (Credit account titles are automatically indented when
amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List
all debit entries before credit entries.)
Date
Account Titles and Explanation
Jan. 2, 2025
Jan. 2, 2025
(To record sales on account)
(To record cost of goods sold)
Debit
Credit
Chapter 1 Solutions
Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
Ch. 1 - How does management accounting differ from...Ch. 1 - Management accounting should not fit the...Ch. 1 - How can a management accountant help formulate...Ch. 1 - Describe the business functions in the value...Ch. 1 - Explain the term supply chain and its importance...Ch. 1 - Management accounting deals only with costs. Do...Ch. 1 - How can management accountants help improve...Ch. 1 - Prob. 1.8QCh. 1 - Prob. 1.9QCh. 1 - What three guidelines help management accountants...
Ch. 1 - Prob. 1.11QCh. 1 - Prob. 1.12QCh. 1 - Prob. 1.13QCh. 1 - Prob. 1.14QCh. 1 - Prob. 1.15QCh. 1 - Which of the following is not a primary function...Ch. 1 - Value chain and classification of costs, computer...Ch. 1 - Prob. 1.18ECh. 1 - Value chain and classification of costs, fast-food...Ch. 1 - Key success factors. Dominion Consulting has...Ch. 1 - Key success factors. Vargas Construction Company...Ch. 1 - Planning and control decisions. Gregor Company...Ch. 1 - Planning and control decisions. Gavin Adams is the...Ch. 1 - Prob. 1.24ECh. 1 - Five-step decision-making process, service firm....Ch. 1 - Professional ethics and reporting division...Ch. 1 - Professional ethics and reporting division...Ch. 1 - Planning and control decisions, Internet company....Ch. 1 - Prob. 1.29PCh. 1 - Prob. 1.30PCh. 1 - Management accounting guidelines. For each of the...Ch. 1 - Prob. 1.32PCh. 1 - Prob. 1.33PCh. 1 - Budgeting, ethics, pharmaceutical company. Chris...Ch. 1 - Professional ethics and end-of-year actions. Linda...Ch. 1 - Professional ethics and end-of-year actions....Ch. 1 - Ethical challenges, global company environmental...
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