According to the revenue recognition principle, revenues should be recognized when or as the company performs acts promised to the customer. For many businesses, this condition is met at the point of delivery of goods or services. The following transactions occurred in September: Required: For each of the transactions, if revenue is to be recognized in September, indicate the amount. (Enter your answers in dollars but not in millions.) Activity Amount Guppie Enterprises Inc. received $12 for an auto part sold to a customer last a. month. Chrome University received $36,270,000 cash for 93,000 five-game-season b. football tickets. None of the games have been played. Chrome played the first football game referred to in (b). 7,254,000 C. Mell Construction Company was constructing a new office building for a customer. The customer wrote Mell a check for $660,000. At the time of the 66,000 d. check work was completed during the month in the amount of $66,000. The remainder of the project will be completed in future months. A popular snowboarding magazine company received a total of $2,200 today e. from subscribers. The subscriptions begin in the next fiscal year. Answer from the magazine company's standpoint. TrusTee Communications sold a $330 cell phone plan for service in September f. to a customer who charged the sale on his credit card. Answer from the standpoint of TrusTee Communications. 330
According to the revenue recognition principle, revenues should be recognized when or as the company performs acts promised to the customer. For many businesses, this condition is met at the point of delivery of goods or services. The following transactions occurred in September: Required: For each of the transactions, if revenue is to be recognized in September, indicate the amount. (Enter your answers in dollars but not in millions.) Activity Amount Guppie Enterprises Inc. received $12 for an auto part sold to a customer last a. month. Chrome University received $36,270,000 cash for 93,000 five-game-season b. football tickets. None of the games have been played. Chrome played the first football game referred to in (b). 7,254,000 C. Mell Construction Company was constructing a new office building for a customer. The customer wrote Mell a check for $660,000. At the time of the 66,000 d. check work was completed during the month in the amount of $66,000. The remainder of the project will be completed in future months. A popular snowboarding magazine company received a total of $2,200 today e. from subscribers. The subscriptions begin in the next fiscal year. Answer from the magazine company's standpoint. TrusTee Communications sold a $330 cell phone plan for service in September f. to a customer who charged the sale on his credit card. Answer from the standpoint of TrusTee Communications. 330
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:According to the revenue recognition principle, revenues should be recognized when or as the company performs acts promised to
the customer. For many businesses, this condition is met at the point of delivery of goods or services. The following transactions
occurred in September:
Required:
For each of the transactions, if revenue is to be recognized in September, indicate the amount. (Enter your answers in dollars but not
in millions.)
Activity
Amount
Guppie Enterprises Inc. received $12 for an auto part sold to a customer last
a.
month.
Chrome University received $36,270,000 cash for 93,000 five-game-season
b.
football tickets. None of the games have been played.
ol
Chrome played the first football game referred to in (b).
7,254,000
C.
Mell Construction Company was constructing a new office building for a
customer. The customer wrote Mell a check for $660,000. At the time of the
$
d.
check work was completed during the month in the amount of $66,000. The
remainder of the project will be completed in future months.
A popular snowboarding magazine company received a total of $2,200 today
from subscribers. The subscriptions begin in the next fiscal year. Answer from
the magazine company's standpoint.
TrusTee Communications sold a $330 cell phone plan for service in September
f. to a customer who charged the sale on his credit card. Answer from the
standpoint of TrusTee Communications.
66,000
e.
$
$
330
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