A New York City daily newspaper called Manhattan Today charges an annual subscription fee of $108. Customers prepay their subscriptions and receive 250 issues over the year. To attract more subscribers, the company offered new subscribers the ability to pay $110 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $100 per hour. The company estimates that approximately 30% of the coupons will be redeemed. Required: 1. How much revenue should Manhattan Today recognize upon receipt of the $110 subscription price? 2. How many performance obligations exist in this contract? 3. Prepare the journal entry to recognize sale of 14 new subscriptions, clearly identifying the revenue or deferred revenue associated with each performance obligation.
Q: What does it mean when there are claims on the economic resources
A: Economic resource refers to the factors that help in producing goods and services. The economic…
Q: Accrual versus cash basis of accounting PepsiCo, Inc. (PEP) is a food and beverage company with a…
A: Cash and accrual basis of accounting are two type of bases that are used in business. Under cash…
Q: Contribution margin and contribution margin ratio For a recent year, McDonald’s (MCD) company-owned…
A: MARGINAL COSTING INCOME STATEMENTMarginal Costing Income Statement is one of the Important Cost…
Q: In early December, Alice and Bob decided to open the Sample Cafe with $15,000 of their own money and…
A: Balancesheet is otherwise known positional statement of the company. It shows financial position of…
Q: The following transactions of Berain Manufacturers, that uses the perpetual inve 2024 in respect of…
A: First in first out method (FIFO) method 28 February 2024 :- ending inventory360 units at 35.50 per…
Q: TB MC Qu. 6-111 Majid Corporation sells a product for ... Majid Corporation sells a product for $190…
A: Margin of safety is the difference between total sales and break-even sales. The Break-even point…
Q: ohn and Jamie Kerr (ages 67 and 64, respectively) do not claim any dependents on their joint tax…
A: Taxable income refers to the portion of an individual's income that is subject to income tax. It is…
Q: Gipple Corporation makes a product that uses a material with the quantity standard of 7.3 grams per…
A: The variance is the difference between the actual and standard cost data. The materials price…
Q: Fabert Corporation uses the weighted-average method in its process costing system. The Assembly…
A: The equivalent units are calculated on the basis of the percentager of the work completed during the…
Q: The Boswell Corporation forecasts its sales in units for the next four months as follows: March…
A: The production budget is referred as a detailed plan that outlines number of units the company needs…
Q: Bay Cruiseline offers nightly dinner cruises off the coast of Miami, San Francisco, and Seattle.…
A: Contribution margin is excess of sales over variable costs. Breakeven point is that point at which…
Q: Nabb & Fry Co. reports net income of $25,000. Interest allowances are Nabb $5,900 and Fry $4,400,…
A: A deficiency is a situation where the allocated or allowed amount for a specific category or purpose…
Q: Which of the following statements is TRUE? A. Technological change is one of the ongoing challenges…
A: Option A is correct as : There are several expenses associated with technology, including the costs…
Q: Crane Company purchased merchandise with an invoice price of $3400 and credit terms of 2/10, n/30.…
A: Credit terms is the agreement between the seller and the buyer for the goods sold on credit in which…
Q: Abwenzi limited opens a new factory in Kawambwa and receives a government grant of k20,000 in…
A: Capital Approach:Under the Capital Approach, the government grant is treated as a deduction from the…
Q: Compute the 2023 tax liability and the marginal and average tax rates for the following taxpaye…
A: Tax rules and regulations fluctuate greatly between jurisdictions, and they may define taxable…
Q: A3
A: Adjusting Entries are the entries that make the accrual principle work for the organization. These…
Q: Below are Laiho Industries’ 2017 and 2018 balance sheet items: 2018 2017 Cash $…
A: An income statement is one of the financial statements of a business organization and it shows all…
Q: Fill in the amortization schedule below for a $10,000 debt that is to be amortized in six equal…
A: An amortized loan is a form of loan that is set up so that the interest and a portion of the…
Q: Which of the following statements is incorrect? Multiple Choice External financial reporting…
A: Overhead refers to the indirect costs or expenses incurred by a business or organization that are…
Q: Use the following information to answer the question that follow: Net Income : $205,000 Profit…
A: Days sales in receivable is calculated by dividing number of days in a year by account receivable…
Q: The general ledger of Jackrabbit Rentals at January 1, 2024, includes the following account…
A: Trial Balance is the statement that records all the assets, liabilities, stockholders' equity,…
Q: Larner Corporation is a diversified manufacturer of industrial goods. The company's activity-based…
A: Activity based costing system is one of cost allocation method where all indirect costs and expenses…
Q: Which characteristic is applicable to financial statements when provision is made for all known…
A: Financial statements are formal records of the financial activities and position of a business,…
Q: Fact Pattern: ChemKing uses a standard costing system in the manufacture of its single product. The…
A: To assess how well the company is doing compared to the budget, variance analysis is performed.…
Q: Sheridan Repairs has 200 auto-maintenance service outlets nationwide. It performs primarily two…
A: Sales needed for target net income :— It is calculated by dividing sum of fixed cost and target net…
Q: Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution…
A: The contribution margin takes into consideration variable expenses only.Variable costs are costs…
Q: Current Attempt in Progress In Blossom Company, total materials costs are $37,500, and total…
A: The unit manufacturing cost is a combination of material cost per unit and conversion cost per unit.…
Q: Crane Corp. had the following shareholders' equity on January 1, 2023: Common shares, unlimited…
A: Journal Entry is the primary step in recording the transactions in the books of accounts.The…
Q: (a) What are the source documents for direct materials, direct labor, and manufacturing overhead…
A: TOTAL COSTTotal Cost is the cost which is incurred to manufacture a product.Total Cost Includes Cost…
Q: Sheridan Company uses a job order cost system and applies overhead to production on the basis of…
A: Predetermined overhead rate is the one which is computed at the beginning of a period in order to…
Q: Closing entries with net loss Summit Services Co. offers its services to individuals desiring to…
A: Closing Entry: It implies a journal entry that is recorded by the business at the end of its…
Q: Salaries expense Common stock Notes receivable (short term) Allowance for doubtful accounts…
A: Income statement is a financial statement that records all the income and expenses of the business…
Q: On December 31, 2020, Monty Co. performed environmental consulting services for Hayduke Co. Hayduke…
A: A journal entry is a financial record kept by a company or individual to record a specific financial…
Q: (1) Compute the loss that Flounder Bank will suffer from the debt restracturing (Round answer to 0…
A: Debt restructuring is the process through which a borrower and its creditors modify or restructure…
Q: Journalize the entries to record the following selected bond investment transactions for Marr…
A: Journal Entry is the primary step in recording the transactions in the books of accounts.The…
Q: unTime Cruiseline offers nightly dinner cruises departing from several cities on the East Coast of…
A: Variable costs are costs that vary with the change in the level of output whereas fixed costs are…
Q: Under the net asset value method, the practitioner determined the Widget Company's assets had a…
A: Net asset value method is a method which is used to calculate the value of business. net asset can…
Q: StarQuest plans to introduce a new entertainment package and estimates immediate sales of $300…
A: Cost of the delay is the total impact of the delay on the launch of a product.Cost of the delay =…
Q: The following data are given for Taylor Company: Budgeted production Actual production Materials:…
A: Direct labor variance is the difference between standard direct labor cost for actual production…
Q: Sarasota Company sells equipment on September 30, 2022, for $20,600 cash. The equipment originally…
A: The accumulated depreciation is the depreciation charged on the assets till date. The book value of…
Q: You are scheduled to receive $45,000 in two years. When you receive it, you will invest it for 5…
A: Amount Received = $45,000Investment Period (n) = 5 yearsInterest Rate (r) = 5% or 0.05
Q: Kronk, Incorporated provides the following information concerning the work in process at its plant:…
A: Material is the cost which is incurred by the entity on the making of the goods. It is a direct…
Q: Steps in the accounting cycle Rearrange the following steps in the accounting cycle in proper…
A: Accounting cycle is a series of different steps starting from the identification of a transaction,…
Q: Four financial statements are usually prepared for a business. The statement of cash flows is…
A: “Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: This year, Sigma, Incorporated generated $612,000 income from its routine business operations. In…
A: Depreciation is a method of reducing the book value of a fixed asset over a period of time. There…
Q: The following summarizes Tesla's merchandising activities for the year. Cost of merchandise sold to…
A: Merchandise purchase, net = Merchandise inventory, gross - Purchase return and allowances - purchase…
Q: On January 2, 2020, Martinez Corporation issued $1,700,000 of 10% bonds at 97 due December 31, 2029.…
A: Bonds are the securities which are issued by the entities in order to raise capital for the…
Q: Current Attempt in Progress 40 Crane Oil Imports is a partnership owned by Magda William and Giannis…
A: Partnership Firm is an organization where an agreement is formed between two or more individuals for…
Q: Whitman Company has just completed its first year of operations. The company's absorption costing…
A: Variable costs are costs that vary with the change in the level of output whereas fixed costs are…
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
- A New York City daily newspaper called “Manhattan Today” charges an annual subscription fee of $135. Customers prepay their subscriptions and receive 260 issues over the year. To attract more subscribers, the company offered new subscribers the ability to pay $130 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $125 per hour. The company estimates that approximately 30% of the coupons will be redeemed. Prepare the journal entry to recognize sale of 10 new subscriptions, clearly identifying the revenue or deferred revenue associated with each performance obligation.A New York City daily newspaper called “Manhattan Today” charges an annual subscription fee of $135. Customers prepay their subscriptions and receive 260 issues over the year. To attract more subscribers, the company offered new subscribers the ability to pay $130 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $125 per hour. The company estimates that approximately 30% of the coupons will be redeemed. Prepare the journal entry to recognize sale of 10 new subscriptions, clearly identifying the revenue or deferred revenue associated with each performance obligation. The correct answer is: DR Cash - $1,300 CR Deferred Revenue - discount coupon $130 CR Deferred Revenue - subscription $1,170 ...but I have no idea how "they" came up with the deferred revenue costs. I've asked my professor, but since it's an online summer course, they're not into…A New York City daily newspaper called “Manhattan Today” charges an annual subscription fee of $135. Customers prepay their subscriptions and receive 260 issues over the year. To attract more subscribers, the companyoffered new subscribers the ability to pay $130 for an annual subscription that also would include a coupon toreceive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of acarriage ride is $125 per hour. The company estimates that approximately 30% of the coupons will be redeemed.Required:1. How much revenue should Manhattan Today recognize upon receipt of the $130 subscription price?2. How many performance obligations exist in this contract?3. Prepare the journal entry to recognize sale of 10 new subscriptions, clearly identifying the revenue ordeferred revenue associated with each performance obligation.
- A New York City daily newspaper called “Manhattan Today” sells annual subscriptions for a fee of $216. To attract more subscribers, the company offered a package to new subscribers. The $210 cost of the package includes: an annual subscription and a coupon for a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $200 per hour. The company estimates that approximately 30% of the coupons will be redeemed. Required: How much revenue should Manhattan Today recognize upon receipt of the $210 subscription price? How many performance obligations exist in this contract? Prepare the journal entry to recognize sale of 15 new subscriptions, clearly identifying the revenue or deferred revenue associated with each performance obligation.Mammoth Publishing, Inc. owns a weekly magazine called “Nova Health,” and sells annual subscriptions for $96. Customers prepay their subscription fee and receive 52 issues starting in the following month. The company also offers new subscribers a 25% discount coupon on its other weekly magazine called “Fishing & Camping,” which has a list price of $84 for an annual subscription. Mammoth estimates that approximately 10% of the discount coupons will be redeemed.Required:(a) How many performance obligations are in a single subscription contract?(b) Prepare the journal entry to account for one new subscription of “Nova Health,” clearly identifying the revenue or deferred revenue associated with each performance obligation. of performance obligations: 2 Journal entry worksheet Note: Enter debits before credits. Transaction General Journal Debit Credit 1Mammoth Publishing, Incorporated owns a weekly magazine called “Nova Health,” and sells annual subscriptions for $86. Customers prepay their subscription fee and receive 52 issues starting in the following month. The company also offers new subscribers a 30% discount coupon on its other weekly magazine called “Fishing & Camping,” which has a list price of $70 for an annual subscription. Mammoth estimates that approximately 10% of the discount coupons will be redeemed.\\n\\nRequired:\\n(a) How many performance obligations are in a single subscription contract?\\n\\n(b) Prepare the journal entry to account for one new subscription of “Nova Health,” clearly identifying the revenue or deferred revenue associated with each performance obligation.
- Curt Rugs is holding a 2-week carpet sale at Jean's Club, a local warehouse store. Curt Rugs plans to sell carpets for $1,000 each. The company will purchase the carpets from a local distributor for $400 each, with the privilege of returning any unsold units for a full refund. Jean's Club has offered Curt Rugs two payment alternatives for the use of space. Read the requirements. Requirement 1. Calculate the breakeven point in units for (a) option 1 and (b) option 2. Begin by determining the formula to calculate the breakeven point in units. Number of units to breakeven More Info • Option 1: A fixed payment of $17,400 for the sale period • Option 2: 20% of total revenues earned during the sale period Assume Curt Rugs will incur no other costs.Serpent Home Depot carries wide variety of promotional techniques to attract customers. Kitchen and home appliances are sold in a one-year warranty for replacement of parts and labor. The estimated warranty cost, based on past experience is 5% of sales. The premium is offered on the home furniture. Customer receive a coupon for each peso spent on home furniture. Customers may exchange 2,000 coupons and P50 for a rice cooker which company purchased at P340 for each rice cooker and estimates that 60% of the coupons given to customers will be redeemed. The company’s total sales for 2016 were P115,200,000 – P86,400,000 from kitchen and home appliances and P28,800,000 from home furniture. Replacement parts and labor for warranty work totaled P2,624,000 during 2016. A total of 5,200 rice cookers used in the premium program were purchased during the year and there were 9,600,000 coupons redeemed in 2016. The accrual method is used by the company to account for the warranty and premium…Cover Rugs is holding a 2-week carpet sale at Josh’s Club, a local warehouse store. Cover Rugs plans to sell carpets for $950 each. The company will purchase the carpets from a local distributor for $760 each, with the privilege of returning any unsold units for a full refund. Josh’s Club has offered Cover Rugs two payment alternatives for the use of space. ■ Option 1: A fixed payment of $7,410 for the sale period ■ Option 2: 10% of total revenues earned during the sale period Assume Cover Rugs will incur no other costs. Q1. Calculate the breakeven point in units for (a) Option 1 and (b) Option 2. Q2. At what level of revenues will Cover Rugs earn the same operating income under either option? a. For what range of unit sales will Cover Rugs prefer Option 1? b. For what range of unit sales will Cover Rugs prefer Option 2? Q3. Calculate the degree of operating leverage at sales of 65 units for the two rental options. 4. Briefly explain and interpret your answer to requirement 3.
- Anton Company sells one dozen doughnuts for P500 per box. There is a promotion wherein if a customer buys 3 boxes in a single transaction, a customer received a coupon for one additional box for free. Customers can redeem coupons at any time following the month of sale of the 3 boxes before the expiration date. It is expected 60% of the customers will redeem the coupons. During 2022, the entity sold 15,000 boxes at P500 per box or P7,500,000. During 2023, the entity delivered 2,000 free additional boxes to the customers. Required: 1. Compute the stand-alone selling price of the coupons. 2. Allocate the transaction price to the products sold and the coupons. 3. Prepare the journal entry to record the sale of the products and issue of the free product coupons in 2022 4. Prepare the journal entry to record the delivery of 2,000 free additional boxes in 2023.A vendor is running a promotion whereby a consumer who purchases three boxes of golf balls at P20 per box in a single transaction receives an offer for one free box of golf balls if the customer fills out a request form and mails it to the vendor before a set expiration date (a mail-in rebate). The vendor estimates, based on recent experience with similar promotions, that 80% of the customers will complete the mail-in rebate required to receive the free box of golf balls. How much of the transaction price is allocated to the mail-in rebate?Victoria Company sells bedsheets for P3,000 per set. There is a promotion wherein if a customer buys 4 sets in a single transaction, the customer receives a coupon for one additional set for free. Customers should go to the entity's website, fill out a request form, input the coupon number and submit online before the expiration date. It is expected that 80% of the coupons will be redeemed. During 2021, the entity sold 1,000 sets at P3,000 per set or P3,000,000. During 2022, the entity delivered 75 free additional sets. Required: 1. Compute the stand-alone price of the coupons. 2. Allocate the transaction price to the products sold and the coupons. 3. Prepare journal entries for 2021 and 2022. 4. Compute the deferred revenue from coupons on December 31, 2022.