Among other select appliances, Lincoln Appliance Company sells high-end refrigerators on a standalone basis. Lincoln also sells installation services and maintenance services for the refrigerators. When maintenance services are provided, the maintenance service is priced at $500, which approximates the amount charged by independent third parties. On June 21, 2022, a customer purchased a refrigerator, including maintenance and installation, for $3,400. The refrigerator purchased alone would have cost the customer $3,200. If the installation had been done by an outside party, they would have charged $300. The customer pays cash on June 21, and the delivery is scheduled for July 1. At that time, it is successfully installed. The maintenance contract covers two years from the installation date. What journal entries will Lincoln make in June and July 2022 regarding this transaction?

Among other select appliances, Lincoln Appliance Company sells high-end refrigerators on a standalone basis. Lincoln also sells installation services and maintenance services for the refrigerators. When maintenance services are provided, the maintenance service is priced at $500, which approximates the amount charged by independent third parties. On June 21, 2022, a customer purchased a refrigerator, including maintenance and installation, for $3,400. The refrigerator purchased alone would have cost the customer $3,200. If the installation had been done by an outside party, they would have charged $300. The customer pays cash on June 21, and the delivery is scheduled for July 1. At that time, it is successfully installed. The maintenance contract covers two years from the installation date. What journal entries will Lincoln make in June and July 2022 regarding this transaction?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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