On January 1, 2018, an entity enters into a contract to transfer Products C and D to a customer in exchange for P1,000. The contract requires Product C to be delivered first and states that payment for the delivery of Product C is conditional on the delivery of Product D. The stand-alone selling prices of Product C and D are P480 and P720, respectively. Product C is delivered on January 3, 2018 while Product D is delivered on March 31, 2018. The customer pays on April 8, 2018. How much is the balance of contract liability on January 3, 2018?
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- Current Attempt in Progress On May 10, 2020, Sunland Co. enters into a contract to deliver a product to Splish Brothers Inc. on June 15, 2020. Splish Brothers agrees to pay the full price of $2,210 on July 15, 2020. The cost of goods is $1,190. Sunland delivers the product to Splish Brothers on June 15, 2020, and receives payment on July 15, 2020. Prepare the journal entries for Sunland on May 10, June 15, and July 15 related to this contract. (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. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit (To record the delivery) (To record cost of goods sold)On January 5, 2019, our company receives a nonbinding purchase order for sale of merchandise to a customer in Slovakia, with delivery of the merchandise scheduled for June 30, 2019. The customer preliminarily agreed to pay €650,000 for the merchandise, and payment is due from the customer upon delivery. On January 5, 2019, our company also purchases an option that gives our company the right to sell (i.e., put) €650,000 on any date until June 30, 2019 (i.e., it is an “American-style” option) for $1.28:€1 (i.e., the spot rate on January 5, 2019). On January 5, 2019, the fair value of the option (i.e., the option premium) is $19,500. In addition, our company elected to immediately include in the determination of net income all of the change in option value attributable to factors excluded from the assessment of hedge effectiveness (i.e., the non-intrinsic-value components, like time value). The relevant exchange rates and related balances for the period from January 5, 2019, to June 30,…On May 10, 2020, Cullumber Co. enters into a contract to deliver a product to Greig Inc. on June 15, 2020. Greig agrees to pay the full contract price of $1,980 on July 15, 2020. The cost of the goods is $1,280. Cullumber delivers the product to Greig on June 15, 2020, and receives payment on July 15, 2020. Prepare the journal entries for Cullumber related to this contract. Either party may terminate the contract without compensation until one of the parties performs.
- On January 1, 2019, Fulton Inc. enters into a contract with Gibson to deliver goods. Gibson pays $100,000 at the time the contract is signed, at which time the goods are transferred and Fulton’s performance obligation is complete. In addition, Gibson agrees to pay Fulton $100,000 on December 31, 2019, and December 31, 2020. If Fulton entered into a financing arrangement with Gibson it would charge an interest rate of 9%. Please assist with the journal entries. Thank you! There are 8 journal entries in all.On May 1. 2020, Indigo Inc entered into a contract to deliver one of its specialty mowers to Kickapoo Landscaping Co. The contract requires Kickapoo to pay the contract price of $826 in advance on May 15, 2020. Kickapoo pays Indigo on May 15, 2020, and Indigo delivers the mower (with cost of $511) on May 31, 2020. (a) Prepare the journal entry on May 1, 2020, for Indigo. (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.) Date Account Titles and Explanation Debit Credit May 1, No Entry 2020 (b) Prepare the journal entry on May 15, 2020, for Indigo. (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.) Date Account Titles and Explanation May 15. Debit Credit Cash 826 2020 un (C) Prepare the journal…Ivanhoe Company sells goods that cost $250,000 to Bridgeport Company for $400,000 on January 2, 2020. The sales price includes an installation fee, which is valued at $41,000. The fair value of the goods is $369,000. The goods were delivered on March 1, 2020. Installation is considered a separate performance obligation and was completed on June 18, 2020. Under the terms of the contract, Bridgeport Company pays Ivanhoe $261,000 upon delivery of the goods and the balance at the completion of the installation. Using the five-step process for revenue recognition, determine when and how much revenue would be recognized by Ivanhoe. Assume IFRS is followed. (Round percentage allocations to 2 decimal places, 15.25 and final answers to 0 decimal places, e.g. 5,275.) Performance Obligation When? How much? Deliver goods choose a transaction date January 2, 2020March 1, 2020June 18, 2020 $enter a…
- On August 1, Ling-Harvey Corporation (a U.S.-based importer) placed an order to purchase merchandise from a foreign supplier at a price of 400,000 ringgits. Ling-Harvey will receive and make payment for the merchandise in three months on October 31. On August 1, Ling-Harvey entered into a forward contract to purchase 400,000 ringgits in three months at a forward rate of $0.60. It properly designates the forward contract as a fair value hedge of a foreign currency firm commitment. The fair value of the firm commitment is measured by referring to changes in the forward rate. Relevant exchange rates for the ringgit are as follows:Ling-Harvey’s incremental borrowing rate is 12 percent. The present value factor for one month at an annual interest rate of 12 percent (1 percent per month) is 0.9901. Ling-Harvey must close its books and prepare its third-quarter financial statements on September 30.a. Prepare journal entries for the forward contract and firm commitment through October 31.b.…Brandlin Company of Anaheim, California, purchases materials from a foreign supplier on December 1, 2017, with payment of 32,000 korunas to be made on March 1, 2018. The materials are consumed immediately and recognized as cost of goods sold at the date of purchase. On December 1, 2017, Brandlin enters into a forward contract to purchase 32,000 korunas on March 1, 2018. Relevant exchange rates for the koruna on various dates are as follows: Date Spot Rate Forward Rate(to March 1, 2018) December 1, 2017 $ 5.00 $ 5.075 December 31, 2017 5.10 5.200 March 1, 2018 5.25 N/A Brandlin’s incremental borrowing rate is 12 percent. The present value factor for two months at an annual interest rate of 12 percent (1 percent per month) is 0.9803. Brandlin must close its books and prepare financial statements at December 31. a-1. Assuming that Brandlin designates the forward contract as a cash flow hedge of a foreign currency payable and recognizes any…On December 15, 2001, star glass Co. entered into a 30-day forward contract to buy 10,000 yens at the forward rate of 1.50. 0n December 31, 2001, the forward rate was 1.25 and january 15,2002, the spot rate moved to 1.60. Provide the journal entries under each of the following scenarios: (a) the contract is settled by the actual purchase of yens; and (b) the contract is settled through net cash payment.
- On June 1, 2023, Cali Company entered into a contract to buy equipment for $15,000 from Belt Supply. The contract required Cali to pay $15,000 in advance on June 1, 2023. The equipment was delivered on July 3, 2023. The journal entry on Bolt's books to record the contract on June 1, 2023 includesOn May 1, 2021 Race Cars Inc. enters into a contract with a major U.S. racing program to design and distribute training equipment. Under the terms of the contract, Race Cars will deliver the training equipment on August 1, 2022. The customer will pay $300,000 to Race Cars, Inc. on May 15, 2021. Interest incurred on similar financing agreements in the industry is $35,000. What is the transaction price Which should Race Cars, Inc. recognize: interest expense or interest income for this transaction?On May 10, 2025, Cullumber Co. enters into a contract to deliver a product to Oriole Inc. on June 15, 2025. Oriole agrees to pay the full contract price of $1,980 on July 15, 2025. The cost of the goods is $1,280. Cullumber delivers the product to Oriole on June 15, 2025, and receives payment on July 15, 2025. Prepare the journal entries for Cullumber related to this contract. Either party may terminate the contract without compensation until one of the parties performs. (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.) Date Account Titles and Explanation Debit Credit SI