November 15, 2021 Fields Sales Company entered into a contract to sell footballs for $20,000 to Rodgers Inc. Rodgers Inc. paid $20,000 on November 18, 2021 to Fields Sales. The footballs were delivered to Rodgers, Inc. on November 20, 2021. Determine if the revenue should be recognized over a period of time or at a point in time. Explain why.
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On November 15, 2021 Fields Sales Company entered into a contract to sell footballs for $20,000 to Rodgers Inc. Rodgers Inc. paid $20,000 on November 18, 2021 to Fields Sales. The footballs were delivered to Rodgers, Inc. on November 20, 2021.
Determine if the revenue should be recognized over a period of time or at a point in time. Explain why.
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- On November 1, 2021, Sunland Farm entered into a contract to buy a $144000 harvester from John Deere. The contract required Sunland Farm to pay $144000 in advance on November 1, 2021. The harvester (cost of $104000) was delivered on November 30, 2021. The journal entry to record the contract on November 1, 2021 includes a credit to Sales Revenue for $144000. debit to Unearned Sales Revenue for $144000. credit to Unearned Sales Revenue for $144000. credit to Accounts Receivable for $144000.On April 1, 2021, the seller enters into a contract to deliver products to thecustomer on May 31, 2021. The customer agrees to pay the full contract price of P10,000 on June 15, 2021. The cost of the goods is P7,000. The seller delivers the products to the customer on May 31, 2021 and receives payment on June 15, 2021. Determine the amount of revenue to be recognized by the seller on June 15, 2021.On October 10, 2020, Executor Co. entered into a contract with Belisle Inc. to transfer Executor's specialty products (sales value of $10,000, cost of $6,500) on December 15, 2020. Belisle agrees to make a payment of $5,000 upon delivery and signs a promissory note to pay the remaining balance on January 15, 2021. What entries does Executor make in 2020 on this contract? Ignore time value of money considerations.
- Blossom Construction Company uses the percentage-of-completion method of accounting. In 2021, Blossom began work on a contract it had received which provided for a contract price of $47500000. Other details follow: 2021 Costs incurred during the year $22000000 Estimated costs to complete as of December 31 16000000 Billings during the year 21500000 Collections during the year 10500000 What should be the gross profit recognized in 2021?Cass Company enters into a contract with Dearborn Inc. to sell it $50,000 of goods with delivery on May 10, 2019. Cass manufactured the goods at a cost of $33,000. The contract is signed on April 15, 2019, at which time Dearborn pays Cass $25,000. Cass delivers the goods on May 10, 2019, and Dearborn pays the final $25,000 on that date. Required: 1. What is the transaction price? 2. Prepare Cass’s journal entries related to the contract with Dearborn.Lowery Co. sells major household appliance service contracts for cash. The service contracts are for a one-year, two-year, or three-year period. Cash receipts from contracts are credited to unearned service contract revenues. This account had a balance of P600,000 at 31 December 2019 before year-end adjustment. Service contract costs are charged as incurred to the service contract expense account, which had a balance of P150,000 at 31 December 2019. Outstanding service contracts at 31 December 2019 expire as follows: During 2020 During 2021 During 2022 P125,000 P200,000 P90,000 What amount should be reported as unearned service contract revenues in Lowery's 31 December 2019 statement of financial position?
- Coronado Industries sells major household appliance service contracts for cash. The service contracts are for a one ycar, two-year, or three-year period. Cash receipts from contracts are credited to unearned service contract revenues. This account had a balance of $965000 at December 31, 2019 before year-end adjustment. Service contract costs are charged as incurred to the service contract expense account, which had a balance of $243000 at December 31, 2019. Outstanding service contracts at December 31, 2019 expire as follows: During 2020 During 2021 During 2022 $198000 $318000 $142000 What amount should be reported as unearned service contract revenues in Coronado's December 31, 2019 balance sheet? $460000. O $658000. O $722000. O $516000.Cass Company enters into a contract with Dearborn Inc. to sell it $50,000 of goods with delivery on May 10, 2019. Cass manufactured the goods at a cost of $33,000. The contract is signed on April 15, 2019, at which time Dearborn pays Cass $25,000. Cass delivers the goods on May 10, 2019, and Dearborn pays the final $25,000 on that date. Required: 1. On what date does a contract exist between Cass and Dearborn? 2. What are Cass’s performance obligations in the contract? 3. What is the transaction price? 4. Does this transaction price need to be allocated? 5. Prepare Cass’s journal entries related to the contract with Dearborn.On October 10, 2020, Flounder Co. entered into a contract with Belisle Inc. to transfer Flounder’s specialty products (sales value of $9,200, cost of $6,500) on December 15, 2020. Belisle agrees to make a payment of $5,400 upon delivery and signs a promissory note to pay the remaining balance on January 15, 2021. What entries does Flounder make in 2020 on this contract?
- On July 1, 2021, Concord Inc. entered into a contract to deliver one of its specialty machines to Kickapoo Landscaping Co. The contract requires Kickapoo to pay the contract price of $5,400 in advance on July 15, 2021. Kickapoo pays Concord on July 15, 2021, and Concord delivers the machine (with cost of $2,100) on July 31, 2021. Prepare the journal entry on July 1, 2021, for Concord. (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 0 for the amounts.) Account Titles and Explanation Debit Credit eTextbook and Media List of Accounts Prepare the journal entry on July 15, 2021, for Concord. (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…On December 1, 2020, Shyam Construction Co. entered into a contract with a customer for the construction of a building. The contract prices are $44,00,000, which is to be billed to the customers periodically based on Shyam's progress on the construction. The estimated total contract cost is $28,00,000. The actual costs incurred in 2020 amounts to $12,00,000. Requirement: The revenue to be recognized in 2020Machinery 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 recognition