Crane Land Inc. is a producer and retailer of high-end custom-designed furniture and uses the contract-based approach to revenue recognition. The company produces only to special order and requires a one-third down payment before any work begins. The customer is then required to pay one-third at the time of delivery and the balance within 30 days after delivery. It is now February 1, 2024, and Crane Land has just accepted $2,600 as a down payment from H. Williams, a wealthy stockbroker. Per the contract, Crane Land is to deliver the custom furniture to Williams's residence by June 15, 2024. Williams is an excellent customer and has always abided by the contract terms in the past. If Crane Land cannot make the delivery by June 15, the contract terms state that Williams has the option of cancelling the sale and receiving a full reimbursement of any down payment. It is estimated that Crane Land's cost to design and manufacture the furniture ordered by Williams will be $5,460. As Crane Land's accountant, prepare all journal entries related to the sale. Assume that revenue is recognized at the time of delivery. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries. Record journal entries in the order presented in the problem.)
Crane Land Inc. is a producer and retailer of high-end custom-designed furniture and uses the contract-based approach to revenue recognition. The company produces only to special order and requires a one-third down payment before any work begins. The customer is then required to pay one-third at the time of delivery and the balance within 30 days after delivery. It is now February 1, 2024, and Crane Land has just accepted $2,600 as a down payment from H. Williams, a wealthy stockbroker. Per the contract, Crane Land is to deliver the custom furniture to Williams's residence by June 15, 2024. Williams is an excellent customer and has always abided by the contract terms in the past. If Crane Land cannot make the delivery by June 15, the contract terms state that Williams has the option of cancelling the sale and receiving a full reimbursement of any down payment. It is estimated that Crane Land's cost to design and manufacture the furniture ordered by Williams will be $5,460. As Crane Land's accountant, prepare all journal entries related to the sale. Assume that revenue is recognized at the time of delivery. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries. Record journal entries in the order presented in the problem.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
Please do not give solution in image format ?.
Transcribed Image Text:Date
2024
Account Titles and Explanation
(To record the sale of furniture)
(To record the costs related to the design
and manufacturing of the custom furniture)
Debit
TUL
|||||
Credit
Transcribed Image Text:Crane Land Inc. is a producer and retailer of high-end custom-designed furniture and uses the contract-based approach to revenue
recognition. The company produces only to special order and requires a one-third down payment before any work begins. The
customer is then required to pay one-third at the time of delivery and the balance within 30 days after delivery.
It is now February 1, 2024, and Crane Land has just accepted $2,600 as a down payment from H. Williams, a wealthy stockbroker.
Per the contract, Crane Land is to deliver the custom furniture to Williams's residence by June 15, 2024. Williams is an excellent
customer and has always abided by the contract terms in the past. If Crane Land cannot make the delivery by June 15, the contract
terms state that Williams has the option of cancelling the sale and receiving a full reimbursement of any down payment. It is
estimated that Crane Land's cost to design and manufacture the furniture ordered by Williams will be $5,460.
As Crane Land's accountant, prepare all journal entries related to the sale. Assume that revenue is recognized at the time of
delivery. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry
is required, select "No Entry" for the account titles and enter 0 for the amounts. List all debit entries before credit
entries. Record journal entries in the order presented in the problem.)
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