Cullumber Company sells goods that cost $295,000 to Mark Company for $415,000 on January 2, 2023. The sales price includes an installation fee, which is valued at $39,100. The fair value of the goods is $385,900. The goods were delivered on March 1, 2023. Installation is considered a separate performance obligation and was completed on June 18, 2023. Under the terms of the contract, Mark pays Cullumber $267,000 on delivery of the goods and the balance at the completion of the installation. (a) Using the five-step process for revenue recognition, determine when and how much revenue would be recognized by Cullumber. Assume IFRS is followed. (Round percentage allocations to 2 decimal places, 15.25% and final answers to O decimal places, e.g. 5,275.) Performance Obligation Deliver goods Installation Total When? tA $ LA How much?

Cullumber Company sells goods that cost $295,000 to Mark Company for $415,000 on January 2, 2023. The sales price includes an installation fee, which is valued at $39,100. The fair value of the goods is $385,900. The goods were delivered on March 1, 2023. Installation is considered a separate performance obligation and was completed on June 18, 2023. Under the terms of the contract, Mark pays Cullumber $267,000 on delivery of the goods and the balance at the completion of the installation. (a) Using the five-step process for revenue recognition, determine when and how much revenue would be recognized by Cullumber. Assume IFRS is followed. (Round percentage allocations to 2 decimal places, 15.25% and final answers to O decimal places, e.g. 5,275.) Performance Obligation Deliver goods Installation Total When? tA $ LA How much?

FINANCIAL ACCOUNTING

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ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Cullumber Company sells goods that cost $295,000 to Mark Company for $415,000 on January 2, 2023. The sales price includes an
installation fee, which is valued at $39,100. The fair value of the goods is $385,900. The goods were delivered on March 1, 2023.
Installation is considered a separate performance obligation and was completed on June 18, 2023. Under the terms of the contract,
Mark pays Cullumber $267,000 on delivery of the goods and the balance at the completion of the installation.
(a)
Using the five-step process for revenue recognition, determine when and how much revenue would be recognized by Cullumber.
Assume IFRS is followed. (Round percentage allocations to 2 decimal places, 15.25% and final answers to O decimal places, e.g. 5,275.)
Performance Obligation
Deliver goods
Installation
Total
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When?
$
$
How much?
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(b)
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