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1.
Concept Introduction: Deferred revenues occur when a company receives cash before the delivery of goods or services. The revenue is recognized only when it is earned that is the goods or services are delivered to the customer.
The
2.
Concept Introduction: Deferred revenues occur when a company receives cash before the delivery of goods or services, the revenue is recognized only when it is earned that is the goods or services are delivered to the customer.
The adjustment entry to record deferred revenue under alternative treatment.
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Chapter 3 Solutions
Pearson eText Horngren's Financial & Managerial Accounting: The Financial Chapters -- Instant Access (Pearson+)
- Censider the following note payable transactions of Cargo Video Productions. D(Click the icon to view the transactions.) Requirements 1. Journalize the transactions for the company. Considering the given transactions only, what are Cargo Video Productions' total liabilities on December 31, 2019? 2. X Select explanations on the last line More Info he note requires annual principal pa Credit 2018 Oct. 1 Purchased equipment costing $40,000 by issuing a five-year, 9% note payable. The note requires annual principal payments of $8,000 plus interest each October 1. Dec. 31 Accrued interest on the note payable. 2019 Oct. 1 Paid the first installment on the note. Dec. 31 Accrued interest on the note payable. Print Done 4arrow_forwardA gift shop signs a three-month note payable on May 1/2020 of OMR 36,000 with an annual interest of 10%. What is the adjusting entry to be made on December 31 for the interest expense accrued to that date? Select one: O a. Debit Interest Expense, 2,400; Credit Interest Payable, 2,400. b. Debit Prepaid Interest, 2,000; Credit Interest Expense, 2,000. c. Debit Interest Expense, 2,100; Credit Interest Payable, 2,100. d. None of the answers are correct e. Debit Interest Expense, 2,400; Credit Prepaid Interest, 2,400.arrow_forwardInstructions General Journal Balance Sheet On August 1, 2019, Pereira Corporation has sold 1,500 Wiglows to Mendez Company at $420 each. Mendez also purchased a 1- 1. Prepare the necessary journal entries to record: 2. Show how Pereira would report the items on the December 31, 2019, balance sheet. year service-type warranty on all the Wiglows for $10 per unit. In 2019, Pereira incurred warranty costs of $9,000. Costs for 2020 were $3,000. 1. The sale of Wiglows and service warranty on account on August 1, 2019 Balance Sheet Instruction Required: 2. The warranty costs paid during 2019 1. Prepare the journal entries for the preceding transactions. 3. The warranty revenue earned in 2019 2. Show how Pereira would report the items on the December 31, 2019, balance sheet. 4. The warranty costs paid during 2020 PEREIRA CORPORATION 5. The warranty revenue earned in 2020 Partial Balance Statement December 31, 2019 1 Current Liabilities: General Journal Instructions 2 PAGE 1 GENERAL JOURNAL…arrow_forward
- On March 1, 2022, Jaiku Industrial gave Light Co. a 180-day, 8%, $78,000 note payable to extend journal entry for Jaiku Industrial to record payment of the note on August 28, 2022. Jaiku Industri adjusting entry. Short Answer Toolbar navigationarrow_forwardPrepare all journal entries and adjusting journal entries necessary to record all of Red Robin's transactions related to the note payable information below: Red Robin purchased the building on January 1, 2019, for $496,300 using a note payable. The loan is a 30-year, 5% installment loan with annual payments due every December 31. See amortization table below: Building Loan Amortization Principal Interest Years Payments/year Payment Date 31-Dec-19 31-Dec-20 31-Dec-21 31-Dec-22 31-Dec-23 31-Dec-24 31-Dec-25 31-Dec-26 31-Dec-27 31-Dec-28 31-Dec-29 31-Dec-30 31-Dec-31 31-Dec-32 31-Dec-33 31-Dec-34 31-Dec-35 31-Dec-36 31-Dec-37 31-Dec-38 31-Dec-39 31-Dec-40 31-Dec-41 31-Dec-42 31-Dec-43 31-Dec-44 31-Dec-45 31-Dec-46 31-Dec-47 31-Dec-48 $496,300 5.00% 30 1 32,285 Interest Principal Payment Balance 496,300 488,830 480,986 7,470 32,285 7,844 32,285 24,815 24,441 24,049 32,285 23,638 32,285 23,205 32,285 22,751 32,285 22,274 10,011 32,285 21,774 10,511 32,285 21,248 11,037 32,285 8,236 8,647…arrow_forwardOn June 7,2019, Dilby Mechanical Corp completed $50,00 of servicing work for a client and billed them for that amount plus a GST of $2,500 and PST of $3,50; terms are N20. Required: a. Prepare the journal entry as it would appear in Dilby's accounting records. b. Assume the receivable established on June 7 was collected on June 27. Record the entry.arrow_forward
- Anderson Air is a customer of Handler Cleaning Operations. For Anderson Airs latest purchase on January 1, 2018, Handler Cleaning Operations issues a note with a principal amount of $1,255,000, 6% annual interest rate, and a 24-month maturity date on December 31, 2019. Record the journal entries for Handler Cleaning Operations for the following transactions. A. Entry for note issuance B. Subsequent interest entry on December 31, 2018 C. Honored note entry at maturity on December 31, 2019arrow_forwardUnearned Revenue Jennifers Landscaping Services signed a $400-per-month contract on November 1, 2019, to provide plant watering services for Lola Inc.s office buildings. Jennifers received 4 months' service fees in advance on signing the contract. Required: 1. Prepare Jennifers journal entry to record the cash receipt for the first 4 months. 2. Prepare Jennifers adjusting entry at December 31, 2019. 3. CONCEPTUAL CONNECTION How would the advance payment (account(s) and amounts(s)] be reported in Jennifers December 31, 2019, balance sheet? How would the advance payment [account(s) and amount(s)] be reported in Lolas December 31, 2019, balance sheet?arrow_forwardService Revenue Softball Magazine Company received advance payments of $75,000 from customers during 2019. At December 31, 2019, $20,000 of the advance payments still had not been earned. Required: After the adjustments are recorded and posted at December 31, 2019, calculate what the balances will be in the Unearned Magazine Revenue and Magazine Revenue accounts. Use the following information for Cornerstone Exercises 5-23 and 5-24: Bolton sold a customer service contract with a price of S37 000 to Sammys Wholesale Company. Bolton offered terms of 1/10, n/30 and expects Sammy to pay within the discount period.arrow_forward
- Instructions Ellsworth Enterprises borrowed $486,000 on an 12%, interest-bearing note on September 30, 2020. Ellsworth ends its fiscal year on December 31. The note was paid with interest on March 31, 2021. Required: 1. Prepare the entry for this note on September 30, 2020. 2. Prepare the adjusting entry for this note on December 31, 2020. 3. Indicate how the note and the accrued interest would appear on the balance sheet at December 31, 2020. 4. Prepare the entry to record the repayment of the note on March 31, 2021.arrow_forwardMidshipmen Company borrows $11,500 from Falcon Company on July 1, 2021. Midshipmen repays the amount borrowed and pays interest of 12% (1%/month) on June 30, 2022. Required:  1.&2. Record the necessary entries in the Journal Entry Worksheet below. 3. Calculate the 2021 year-end adjusted balances of Interest Receivable and Interest Revenue (assuming the balance of Interest Receivable at the beginning of the year is $0).arrow_forwardMachinery Corp transfers the machine, and collects the total contract price on February 1, 2020 The maintenance services start on that date.  Required  Analyze the five steps of model of revenue recognitionarrow_forward
- Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage LearningPrinciples of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
- Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage Learning
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