On January 1, 2021, Crucell N.V. sold an aeroengine along with a 4 year maintenance agreement to Sleazyjet Airlines for $1164. The standalone selling price of an engine is $776, while the standalone selling price of a maintenance contract is $194 per year. On January 1, the aeroengine was delivered to Sleazyjet. Ignoring the time value of money, the company should record revenue on January 1 of:

On January 1, 2021, Crucell N.V. sold an aeroengine along with a 4 year maintenance agreement to Sleazyjet Airlines for $1164. The standalone selling price of an engine is $776, while the standalone selling price of a maintenance contract is $194 per year. On January 1, the aeroengine was delivered to Sleazyjet. Ignoring the time value of money, the company should record revenue on January 1 of:

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Please help me
On December 31, 2019, Hairy Inc. Sold computer equipment to Barber Co and immediately leased it back for 10 years. The sales price of the equipment was P560, 000, its carrying amount is P400, 000, and its estimated economic life is 12 years. Determine the amount of deferred revenue to be reported from the sale of the computer equipment on December 31, 2012.
On July 2021, Publicus sold a machine to a customer for £500,000 (excluding value added tax), and the customer paid in full when the machine was delivered on that date. In addition to the machine, Publicus agreed to provide maintenance for thirty months ending on 31 December 2023. Publicus has allocated E446,000 of the transaction price to the machine and g54,000 to the maintenance agreement. How much revenue should Publicus recognise from this sale in its income statement for the year to 31 December 2021? a. £467,600 b. £500,000 c. £456,800 d. £446,000
Yellow Company purchases a truck on January 1, 2021. According to the contract Yellow will not make any payments in 2021, 2022 and 2023. Yellow is to make an annuity payment of $5,000 starting December 31, 2024 through December 31, 2028. Calculate the cost of the truck.
On January 2, 2022, BRACE company purchased a new machine on a deferred payment basis. A down payment of P 100,000 was made and a non interest bearing note was issued for 4 monthly instalments of P 250,000 each. The cash equivalent price of the machine was P 950,000. The entity incurred and paid installation costs amounting to P 30,000. Prepare the journal entry on January 2, 2022:
Banco Company acquired a new machine on a delayed payment basis on August 1, 2018. A down payment of P100,000 was made, with four monthly instalments of P250,000 to commence on September 1, 2018. The machine's cash equivalent price was P 950 000. The entity spent and paid P 30 000 in installation fees. What is the sum to be capitalised as the machine's cost?
On 1 July 2017, Entity A purchased a chemical machine from Entity B on credit. The purchase price was $4,560,000 and it will be fully settled on 1 August 2017. A legal and professional fee of $35,500 was paid by a cheque to Entity C in order to ensure the machine can be ready for use on 1 July 2017. The economic life of the machine is 5 years without any residual value. According to the purchase contract, Entity A is required to remove the plant on 30 June 2022 and Entity A estimated the dismantling costs of the plant will be $55,123 on that day. Entity A considered that a discount rate of 10.50% is appropriate for the calculation of present value. On 30 June 2022, the actual dismantling costs were only $45,600 and they were paid by a direct bank transfer to Entity D. On 1 July 2022, a recycling company, Entity E, purchased all the machine scraps for $32,500 on credit and agreed to pay in full on 16 July 2022. REQUIRED: According to relevant accounting standards, prepare journal…
HK Ltd acquired machinery with a cash price of $100,000 under hire purchase terms. HK Ltd made a down payment of $20,000 on 1 September 2019 and settled the balance by 16 equal monthly installments of $5,500 each starting on 1. October 2019. HK Ltd closes its accounts on 31 March each year. The annual allowance rate for the machinery is 30%. Which statement concerning the depreciation allowances for the machinery is correct? OA. The machinery will be transferred to the 30% pool in 2020/21. OB. The annual allowance in the year of assessment 2019/20 is $20,460. OC. The annual allowance in the year of assessment 2020/21 is $5,700. OD. No initial allowance will be given in the year of assessment of 2020/21.
On January 2021 Bob Company sells an item of machinery to Jaison Company for its fair value of $300,000. The asset had a carrying amount of $120,000 prior to the sale. The sale represents the satisfaction of a performance obligation, in accordance with IFRS 15 Revenue from Contracts with Customers. Bob Company enters on to a contracte with Jaison Company for the right to use the asset for the next five years. Annual payments of $50,000 are due at the end of each year. The interest rate implicit in the lease is 10%. The present value of the annual lease payments is $190,000. The remaining useful life of the machine is much greater than the lease term. Required: 1. Explain how it will be recorded in the books of Bob Company and show the necessary journal entries. 2. Why do companies prefer lease financing instead of direct purchase? Explain any three valid reasons.
Do not give answer in image
1. During 2020, Bay Construction started a new construction job with a contract price of $750 million. Bay has a 12/31 fiscal year end. Bay has determined that the contract does not qualify for revenue recognition over time. The contract was completed on 12/31/22 with the following information ($ in millions): Costs incurred in the period (paid in cash) Estimated costs to complete at 12/31 Billings on contract in the period Cash collected in the period 2020 180.0 2021 2022 432.0 150.0 540.0 153.0 -0- 150 350 250 200 400 150 What is the amount of gross profit (loss) on the contract that Bay would recognize on the Income Statement in 2020, 2021 and 2022? You must show supporting work (calculations/explanations) to receive credit for your answers. Gross Profit (Loss) 2020 2021 2022