Answered: 2023 Account Titles and Explanation |…

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

Chapter17: Advanced Issues In Revenue Recognition

Section: Chapter Questions

Problem 17RE: Using the information provided in RE17-16, prepare the journal entries to record Year 1s (a)...

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Question

On January 1, 2023, Cullumber Corp., a management consulting frm, entered into a contract with Viking Company to provide
advisory services over a four-year period. The contract price was $4,080,000 and was to be paid in four equal annual payments at
the end of each year. Cullumber's expenses relating to this contract were $663,000, $744,600, $795,600 and $724,200 for 2023-
2026. Collectibility was reasonably assured throughout the duration of the contract and measurement uncertainties were NOT an
issue.
Using the contract-based revenue recognition model, prepare journal entries for all four years.

2023

2024

2025

2026