Hercules Workout World gains a client who prepays $630 for a package of six physical training sessions. Hercules Workout World collects the $630 in advance and will provide the training later. After two training sessions, what should Hercules Workout World report on its income statement? a. Unearned service revenue of $210 b. Service revenue of $210 c. Cash of $420 d. Service revenue of $630 General Account

Hercules Workout World gains a client who prepays $630 for a package of six physical training sessions. Hercules Workout World collects the $630 in advance and will provide the training later. After two training sessions, what should Hercules Workout World report on its income statement? a. Unearned service revenue of $210 b. Service revenue of $210 c. Cash of $420 d. Service revenue of $630 General Account

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter17: Advanced Issues In Revenue Recognition

Section: Chapter Questions

Problem 7RE: VolleyElite runs a volleyball program consisting of camps, tournaments, and specialized coaching....

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Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format incomestatement for a recent month for the two games appears below:Claimjumper Makeover TotalSales ............................................ $30,000 $70,000 $100,000Variable expenses ...................... 20,000 50,000 70,000Contribution margin ..................... $10,000 $20,000 30,000Fixed expenses .......................... 24,000Net operating income .................. $ 6,000Required:1. Compute the overall contribution margin (CM) ratio for the company.2. Compute the overall break-even point for the company in sales dollars.3. Verify the overall break-even point for the company by constructing a contribution format incomestatement showing the appropriate levels of sales for the two products.
VolleyElite runs a volleyball program consisting of camps, tournaments, and specialized coaching. VolleyElite charges customers 500 per year for access to its facilities and programs. In addition, VolleyElite charges each customer a 100 registration fee. The fee is not refundable and must be paid at the initiation of the contract. Should the registration fee be considered a separate performance obligation from the yearly dues?
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ABC company has a contract to sell 200 bikes to a customer for $400 each and the customer has the right to return the bikes within 30 days for a full refund. Based on past experience the entity places the following probabilities on the number of bikes the customer is expected to return: Number of bikes returned Probability of outcome 0 25% 1 20% 2 28% 3 12% 4 15% Using the ‘expected value’ method, calculate the amount of revenue received from customers. Note: Provide all the calculations, do not just write the final answer.
Marin Shed Solutions sells its largest shed for $1,100 plus HST of 13 %. On May 10, 2024, it sold 26 of these sheds. On May 17,2024, the company sold 85 of these sheds. All sales are cash sales. For each day's sales, calculate the HST. May 10, 2024 May 17, 2024 Question Part Score $ Date $ HST payable Prepare a journal entry to record the sales. (Credit account titles are automatically indented when the 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.) Account Titles Debit --/2 Credit
Allocating Transaction Price to Performance Obligations and Recording Sales Maximum Inc. (retailer) has a loyalty program that rewards its customers one point per $1 spent. Points are redeemable for $0.20 off future purchases. A customer purchases products (cost of $196) for cash at the usual selling price of $280 and earns 280 points redeemable for $56 off future purchases of goods or services. The retailer expects redemption of 252 points or 90% of points earned. Required a. How should the transaction price be allocated among the performance obligation(s)? *Note: Carry all decimals in calculations; round the final answer to the nearest dollar. Performance Obligations Product purchase s Loyalty rewards Total Transaction Price as stated Account Name To record sale of product. 280 ✔ S To record cost of sale of product. 280 S b. Prepare Maximum's journal entry to record the $280 sale to the customer and the cost of that sale where the customer earned 280 loyalty points. *Note: If a…
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CASE BACKGROUND: Digiview, Inc. is a company that offers video streaming of entertainment content for an annual fee of $125. To promote its service, the company places a display advertisement on an entertainment magazine web site called E-Monthly. The E-Monthly web site offers two choices for placement of the ad. Option A: Cost-Per-Thousand (CPM) is $4.00 per 1000 impressions. Option B: Cost-Per-Click (CPC) is $0.25 per click Of the 650,000 people who viewed the ad that Digiview placed on the E-Monthly web site, 10,400 people clicked the advertisement and were directed to the web site of Digiview. Of the 10,400 people who visited the web site of Digiview, 676 people completed on online form requesting more information on the video streaming service. Of the 10,400 people who visited the web site of Digiview, 2288 people left the site after viewing only one page If Digiview chose to place the ad on a CPC basis, what was the cost of the ad? (Show your calculations and final answer…
Allocating Transaction Price to Performance Obligations and Recording Sales Value Dealership Inc. markets and sells the vehicles to retail customers. Along with a new vehicle purchase, a customer will receive a free annual maintenance contract for one year from the date of purchase. The standalone selling price of a vehicle is $30,000 and the standalone selling price for the annual maintenance contract is $400. During October 2020, Value Dealership Inc. sold 30 vehicles for $30,250 per vehicle, each with a free annual maintenance contract. When answering the following questions: Round each allocated transaction price to the nearest dollar. If a journal entry (or a line of the journal entry) isn't required for the transaction, select "N/A" as the account name and leave the Dr. and Cr. answers blank (zero). a. Ignoring the cost entries, record the journal entry in October 2020 for Value Dealership’s sale of vehicles with the associated maintenance contracts to customers.…
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