ceives $154,000 from a local bank and promise re date. The contract states that ownership passes to the bank when Gold rier. In addition, Gold Examiner has agreed to provide a replacement shipm he stand-alone price of a gold bar is $1,560 per unit, and Gold Examiner es
ceives $154,000 from a local bank and promise re date. The contract states that ownership passes to the bank when Gold rier. In addition, Gold Examiner has agreed to provide a replacement shipm he stand-alone price of a gold bar is $1,560 per unit, and Gold Examiner es
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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am.100.
![Exercise 6-5 (Algo) Performance obligations [LO6-2, 6-4, 6-5]
On March 1, 2024, Gold Examiner receives $154,000 from a local bank and promises to deliver 96 units of certified 1-ounce gold bars
on a future date. The contract states that ownership passes to the bank when Gold Examiner delivers the products to Brink's, a third-
party carrier. In addition, Gold Examiner has agreed to provide a replacement shipment at no additional cost if the product is lost in
transit. The stand-alone price of a gold bar is $1,560 per unit, and Gold Examiner estimates the stand-alone price of the replacement
insurance service to be $65 per unit. Brink's picked up the gold bars from Gold Examiner on March 30, and delivery to the bank
occurred on April 1.
Required:
1. How many performance obligations are in this contract?
2. to 4. Prepare the journal entry Gold Examiner would record on March 1, March 30, and April 1.
Complete this question by entering your answers in the tabs below.
Req 1
eq 2 to 4
Prepare the journal entry Gold Examiner would record on March 1, March 30, and April 1.
Note: Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the
first account field. Round your final answers to the nearest whole dollar amount.
View transaction list
Journal entry worksheet](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb51b37df-d49e-470e-9363-3922b64e61bc%2Fb4c34994-946d-4b90-bb81-42a3592f17ce%2Fz5biog3l_processed.png&w=3840&q=75)
Transcribed Image Text:Exercise 6-5 (Algo) Performance obligations [LO6-2, 6-4, 6-5]
On March 1, 2024, Gold Examiner receives $154,000 from a local bank and promises to deliver 96 units of certified 1-ounce gold bars
on a future date. The contract states that ownership passes to the bank when Gold Examiner delivers the products to Brink's, a third-
party carrier. In addition, Gold Examiner has agreed to provide a replacement shipment at no additional cost if the product is lost in
transit. The stand-alone price of a gold bar is $1,560 per unit, and Gold Examiner estimates the stand-alone price of the replacement
insurance service to be $65 per unit. Brink's picked up the gold bars from Gold Examiner on March 30, and delivery to the bank
occurred on April 1.
Required:
1. How many performance obligations are in this contract?
2. to 4. Prepare the journal entry Gold Examiner would record on March 1, March 30, and April 1.
Complete this question by entering your answers in the tabs below.
Req 1
eq 2 to 4
Prepare the journal entry Gold Examiner would record on March 1, March 30, and April 1.
Note: Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the
first account field. Round your final answers to the nearest whole dollar amount.
View transaction list
Journal entry worksheet
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