i) Prepare the journal entries in the books of the company to record the transaction. ii) Explain why the transaction is recorded in this manner using NZ IFRS 15 requirements.
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A telecommunications company enters into a contract with a customer. Under the contract, the company promises to provide to the customer 4 GB data, 300 minutes of talk time, and 500 texts for $36.
Required:
A) A company sells mobile phone sets for $99 each. The company’s cost of each phone set is $70. The phone set became very popular with its customers. Near
the end of the financial year, 5000 customers purchased the phone set from the company. The company allows its customers to return the phone set within 14
days if they have not unpacked the set. The return period has not expired for any phone set sold by the end of the year. The company expects, based on its
past experience, that 1% of its customers will return the phone set.
Required:
i) Prepare the
ii) Explain why the transaction is recorded in this manner using NZ IFRS 15 requirements.
Answer all the subparts A,i and ii.if answered within 30mins,it would be appreciable
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- Tau Limited is a manufacturing business that sales high quality kitchen electronic products. Tau Limited has just entered into 25 lucrative contracts with customers in the SADC region. Each of the contacts includes the sale of one product for P3,000. To manufacture each of these products it cost Tau P2 000 a product. In the contacts, one of the terms is that cash is received upfront and control of the product transfers on delivery. Furthermore, customers can return the product within 30 days to receive a full refund. Tau still has an option of selling the returned products for profit. Tau Limited has been in business for many years and from his experience he can estimate returns for this product quite accurately. Tau has estimated that that 23 products will not be returned. Required: How should the above transaction be accounted for?A telecommunications company enters into a contract with a customer. Under the contract, the company promises to provide to the customer 4 GB data, 300 minutes of talk time, and 500 texts for $36. Required: Briefly explain how the telecommunications company should account for the contract under NZ IFRS 15. You need to refer to the relevant requirements but not to any specific paragraph of NZ IFRS 15. b) A company sells mobile phone sets for $99 each. The company’s cost of each phone set is $70. The phone set became very popular with its customers. Near the end of the financial year, 5000 customers purchased the phone set from the company. The company allows its customers to return the phone set within 14 days if they have not unpacked the set. The return period has not expired for any phone set sold by the end of the year. The company expects, based on its past experience, that 1% of its customers will return the phone set. Required: i) Prepare the journal entries in the books of the…Westinghouse Company, a producer of washing machines, sells various customers. It has a contract to deliver 10 fully automatic washing machines to Soft and Wash Company for a total price of P400,000. The contract contains a clause for free repairs and maintenance services for a period of two years from date of purchase. Soft & Wash paid 50% of the price and half after 3 months. 1. How much sales revenue vill be recognized by Westinghouse on this sale? P400,000 b. P100,000 а. C. P200,000 d. No revenue
- War room has contracted with a local university to replace the entire inventory (1,000) of computers and monitors with the Super Zoom 1000, 48" monitors, along with keyboard and mouse for $1,177,200. This is a 10% discount for a large contract purchase. The contract states all the computers must be installed within 60 days and payments will be Net 60 after installation. Problem: 1. How much will it cost to purchase a large order from the vendors? 2. Does Zoom Computers have the cash flow to make the purchase? 3. How much cash flow will Zoom Computers need to survive 120 days? 4. What recommendations would you offer to the owners of Zoom Computers for raising capital if needed? Need answer for all . Please do not give incomplete or incorrect answer with explanation computation formulation with steps so that I can better understand . Thanks for your helpA television satellite operator launches a loyalty program by which points are granted for using satellite services. The points entitle the customer to a discount on the price to upgrade the satellite receiver or other equipment such as a digital box. Customers who accumulate 1,036 points will receive $259 off the purchase price of any equipment. (In other words, one point has a $0.25 value.) During the first year of the program, customers had accumulated 1,554,000 points on total revenue of $7,536,900. The operator expects that 60% of the points granted will be redeemed. Of the points granted in the first year, 518,000 were redeemed. How would the loyalty program be reflected in the first two years of launch? (Do not round other intermediate calculations. Round percentage of total selling price calculations to 1 decimal place, e.g. 15.2% and final answers to 0 decimal places, e.g. 125.) Revenue Liability related to loyalty points $ 7536900Prepare the journal entry on December 31, 2022, for the 50 extended contracts (the fırst year of the revised 3-year contract). (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. Round answers to O decimal places, e.g. 5,125.) Account Titles and Explanation Debit Credit
- Crane Inc. sells prepaid telephone cards to customers in its convenience stores. When Crane sells cards, it then pays the telecommunications company, Blossom, for the value of the cards less a 20% commission. Assume that Crane receives $3,600 of prepaid cards in January 2025. Crane sold 45% of the cards in February, 30% in March, and 25% in April. The total payment by Crane to Blossom over the 3 months is $2,880. Indicate how much income Crane should recognize in January, February, March, and April. (If answer is 0, please enter O. Do not leave any fields blank.) January income February income $ March income $ April income $ $Flounder Company sells tablet PCs combined with Internet service, which permits the tablet to connect to the Internet anywhere and set up a Wi-Fi hot spot. It offers two bundles with the following terms. 1. Flounder Bundle A sells a tablet with 3 years of Internet service. The price for the tablet and a 3-year Internet connection service contract is $469. The standalone selling price of the tablet is $230 (the cost to Flounder Company is $157). Flounder Company sells the Internet access service independently for an upfront payment of $292. On January 2, 2020, Flounder Company signed 100 contracts, receiving a total of $46,900 in cash. 2. Flounder Bundle B includes the tablet and Internet service plus a service plan for the tablet PC (for any repairs or upgrades to the tablet or the Internet connections) during the 3-year contract period. That product bundle sells for $574. Flounder Company provides the 3-year tablet service plan as a separate product with a standalone selling…Flint Company sells tablet PCs combined with Internet service, which permits the tablet to connect to the Internet anywhere and set up a Wi-Fi hot spot. It offers two bundles with the following terms. 1. Flint Bundle A sells a tablet with 3 years of Internet service. The price for the tablet and a 3-year Internet connection service contract is $481. The standalone selling price of the tablet is $225 (the cost to Flint Company is $174). Flint Company sells the Internet access service independently for an upfront payment of $308. On January 2, 2020, Flint Company signed 100 contracts, receiving a total of $48,100 in cash. 2. Flint Bundle B includes the tablet and Internet service plus a service plan for the tablet PC (for any repairs or upgrades to the tablet or the Internet connections) during the 3-year contract period. That product bundle sells for $586. Flint Company provides the 3-year tablet service plan as a separate product with a standalone selling price of $152. Flint…
- Flounder Company sells tablet PCs combined with Internet service, which permits the tablet to connect to the Internet anywhere and set up a Wi-Fi hot spot. It offers two bundles with the following terms. 1. Flounder Bundle A sells a tablet with 3 years of Internet service. The price for the tablet and a 3-year Internet connection service contract is $469. The standalone selling price of the tablet is $230 (the cost to Flounder Company is $157). Flounder Company sells the Internet access service independently for an upfront payment of $292. On January 2, 2020, Flounder Company signed 100 contracts, receiving a total of $46,900 in cash. 2. Flounder Bundle B includes the tablet and Internet service plus a service plan for the tablet PC (for any repairs or upgrades to the tablet or the Internet connections) during the 3-year contract period. That product bundle sells for $574. Flounder Company provides the 3-year tablet service plan as a separate product with a standalone selling price of…ONE Computer Solution (“ONE") provides IT solutions to corporate clients. ONE offered a price of $2,400 to Client A if he purchases an accounting software from them and choose them to do the installation. Client A agreed and entered into a contract with ONE on 1 January 2022. ONE normally charges clients $2,000 as a standalone selling price for acquiring the accounting software, at a cost of $1,100. The installation service has a standalone selling price of $500. Client A paid ONE $2,000 upon delivery and the remaining balance upon installation of the software. The accounting software was delivered on 1 February 2022. ONE completed installation on 1 March 2022 and client A paid the balance due. Required: (a) Allocate the transaction price between the accounting software and installation service. (b) Prepare the journal entries on the following date (Note: If no entry is required, state “no entry" and write down the reason to support your answer): (i) 1 January 2022. (ii) 1 February…Washamoto Ltd took delivery of a microcomputer and printer on 1 July 20X6, the beginning of its financial year. The list price of the equipment was sh4,999 but Washamoto Ltd was able to negotiate a price of sh4,000 with the supplier. However, the supplier charged an additional sh340 to install and test the equipment. The supplier offered a 5% discount if Washamoto Ltd paid for the equipment and the additional installation costs within seven days. Washamoto Ltd was able to take advantage of this additional discount. The installation of special electrical wiring for the computer cost sh110. After initial testing certain modifications costing sh199 proved necessary. Staff were sent on special training courses to operate the microcomputer and this cost sh 990. Washamoto Ltd insured the machine against fire and theft at a cost of sh 49 per annum. A maintenance agreement was entered into with Sonoma plc. Under this agreement Sonoma plc. Promised to provide 24 hour breakdown cover for one…
