On January 1, 2021, Janelle Co. sold equipment to James Inc. in exchange for a zero-interest bearing note with a face value of $110,000, with payment due in 12 months. The fair value of the equipment on the date of the sale was $100,000. Janelle paid $55,000 for the cost of equipment. Record the journal entries for January 1, 2021 What is the amount of revenue to be recognized on this transaction at December 31, 2021?
On January 1, 2021, Janelle Co. sold equipment to James Inc. in exchange for a zero-interest bearing note with a face value of $110,000, with payment due in 12 months. The fair value of the equipment on the date of the sale was $100,000. Janelle paid $55,000 for the cost of equipment. Record the journal entries for January 1, 2021 What is the amount of revenue to be recognized on this transaction at December 31, 2021?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter13: Investments And Long-term Receivables
Section: Chapter Questions
Problem 23P: Notes Receivable On January 1, 2019, Lisa Company sold machinery with a book value of 118,000 to...
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- On January 1, 2021, Janelle Co. sold equipment to James Inc. in exchange for a zero-interest bearing note with a face value of $110,000, with payment due in 12 months. The fair value of the equipment on the date of the sale was $100,000. Janelle paid $55,000 for the cost of equipment.
- Record the
journal entries for January 1, 2021 - What is the amount of revenue to be recognized on this transaction at December 31, 2021?
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Step 1
Given in the question:
Sale Date = January 1, 2021
Received a zero-interest bearing note with a face value of $110,000 with payment due in 12 months
Purchasing party = James Inc.
Janelle Co. has sold equipment to the purchasing party
Revenue is recognised as an when performace obligations satisfies. Performance obligations may be satisfied at the point or over the time.
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