On January 1, 2022, Elite Rides Corporation started a business renting out luxury vehicles for special events. Current regulations require the business to purchase a permit that will expire after three years. The cost of the permit is $18,000. Calculate the amount of permit expense to be included in the income statement for the 6 months ended June 30, 2022.
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- An entity sells car's spare parts to ZZZ Car Repair during 2020. The entity offers rebates of 3% on purchases up to $30,000 and 4% on purchases above $30,000 if the customer's purchases for the year exceed $120,000. In the past, ZZZ normally purchases more than $100,000 in parts during a calendar year. On March 15, 2020, ZZz Car Repair purchased $38,000 of parts. The journal entry to record the sale includes a a. debit to Accounts Receivable for $36,860. b. credit to Sales Revenue for $36,480. O c. credit to Sales Revenue for $36,860. d. debit to Accounts Receivable for $38,000.The Bigelow Health Club sells annual memberships to a prestigious club. The terms of the contracts are that customers are required to pay an up-front non-refundable fee of $200, and then a monthly fee of $50, with the first month due immediately, for the year for a total cost of $800 to join the club. On February 1 2024 Bigelow sold 10 memberships. Prepare the journal entry for the sale on Feb 1 and the adjusting entry on Feb 29, 2024 to report revenue. Explain what revenue Bigelow will report in the month, and over the course of the year. Assume that 100% of the members of the Bigelow club renew their memberships for 3 years. How does that change the revenue reported in February?(Determine Transaction Price) Taylor Marina has 300 available slips that rent for $800 per season. Payments must be made in full by the start of the boating season, April 1, 2018. The boating season ends October 31, and the marina has a December 31 year-end. Slips for future seasons may be reserved if paid for by December 31, 2018. Under a new policy, if payment for 2019 season slips is made by December 31, 2018, a 5% discount is allowed. If payment for 2020 season slips is made by December 31, 2018, renters get a 20% discount (this promotion hopefully will provide cash flow for major dock repairs).On December 31, 2017, all 300 slips for the 2018 season were rented at full price. On December 31, 2018, 200 slips were reserved and paid for the 2019 boating season, and 60 slips were reserved and paid for the 2020 boating season.Instructions(a) Prepare the appropriate journal entries for December 31, 2017, and December 31, 2018.(b) Assume the marina operator is unsophisticated in business.…
- Sheridan Marina has 200 available slips that rent for $800 per season. Payments must be made in full by the start of the boating season, April 1, 2024. The boating season ends October 31, and the marina has a December 31 year end. Slips for future seasons may be reserved if paid for by December 31, 2024. Under a new policy, if payment for 2025 season slips is made by December 31, 2024, a 4% discount is granted. If payment for 2026 season slips is made by December 31, 2024, renters get a 17% discount. (Sheridan hopes this promotion will provide cash flow for major dock repairs.) On December 31, 2023, all 200 slips for the 2024 season were rented at full price. On December 31, 2024, 150 slips were reserved and paid for the 2025 boating season, and 70 slips were reserved and paid for the 2026 boating season. (a) Prepare the appropriate journal entries for December 31, 2023, and December 31, 2024. (Credit account titles are automatically indented when the amount is entered. Do not indent…On July 31, 2020, Stewart Security was awarded a contract for $102,000 to provide 3,000 hours of overnight security services to the city of Kaysville for the next 2 years. The full contract price was paid to Stewart on July 31. As of December 31, 2020, Stewart had spent 950 hours providing security services. What amount will Stewart report as a liability related to this contract on December 31, 2020?Jung Sa Ha Company must determine the December 31, 2020 year-end accruals for advertising and rent expenses. A P5,000 advertising bill was received January 7, 2021. It related to cost of P3,750 for advertisements in December 2020 issues and P1,250 for advertisements in January 2021 issues of the newspaper. A store lease, effective December 16, 2020 calls for fixed rent of P12,000 per month, payable one month from the effective date and monthly thereafter. In addition, rent equal to 5% of net sales over P3,000,000 per calendar year is payable on January 31 of the following year. Net sales for 2020 were P5,500,000. In its December 31, 2020 balance sheet, Jung Sa Ha should report accrued liabilities of A. P125,000 B. P128,750 C. P131,000 D. P134,750
- Ava Company leased office premises to Olivia, Inc. for a two-year term beginning March 1, 2021 up to February 28, 2023. Under the terms of the operating lease, rent for the first lease year is P20,000 per month and will increase by 10% in the monthly rent for the following lease year. In its financial statements for the fiscal year ending June 30, 2022, what amount should Ava Company report as rent revenue?Ernesco Spare Parts sells parts to Bolt Car Repair during 2024. Ernesco offers rebates of 2% on purchases up to $30,000 and 3% on purchases above $30,000 if the customer’s purchases for the year exceed $100,000. In the past, Bolt normally purchases $150,000 in parts during a calendar year. On March 25, 2024, Bolt Car Repair purchased $37,000 of parts on account. How much revenue from contracts could Ernesco report for this transaction? $Capricorn Company must determine the December 31, 2019 year-end accruals for advertising and rent expenses. A P2,000 advertising bill was received January 6, 2020. It related to costs of P1,500 for advertisements in December 2019 issues and P500 for advertisements in January 2, 2020 issues of the newspaper. A store lease, effective December 15, 2018, calls for fixed rent of P4,800 per month payable 1 month from the effective date and monthly thereafter. In addition, rent equal to 5% of net sales over P1,200,000 per calendar year is payable on January 31 of the following year. Net sales for 2019 were P2,200,000. In its December 31, 2019 statement of financial position, Capricorn should report accrued liabilities of: P51,500 P53,900 P56,800 P56,300
- On August 31, 2022, Firewall Co. licensed its $9,600 application that will protect a customer's computer system from any cyber-attacks for a period of one year. Firewall will need to update this application every month for to fully protect the customers' computer system. How many performance obligation(s) does Firewall have? Also identify the amount of license revenue that Firewall should recognize in 2022 if it has a calendar year end. One performance obligation, and $9,600 license revenue should be recognized in 20X1. Two performance obligation, and $9,600 license revenue should be recognized in 20X1. One performance obligation, and $3,200 license revenue should be recognized in 20X1. Two performance obligation, and $3,200 license revenue should be recognized in 20X1.Company must determine the December 31, 2020year-end accruals for advertising and rent expenses. A P5,000 advertising bill was received January7, 2021. It related to cost of P3,750 for advertisements in December 2020 issues and P1,250 for advertisements in January2021issues of the newspaper. A store lease, effective December 16, 2020c alls for fixed rent of P12,000 per month, payable one month from the effective date and monthly thereafter. In addition, rent equal to 5% of net sales over P3,000,000 per calendar year is payable on January31 of the following year. Net sales for 2020were P5,500,000. In its December31, 2020 balance sheet, company should report accrued liabilities ofBonita Marina has 300 available slips that rent for $900 per season. Payments must be made in full by the start of the boating season, April 1, 2021. The boating season ends October 31, and the marina has a December 31 year-end. Slips for future seasons may be reserved if paid for by December 31, 2021. Under a new policy, if payment for 2022 season slips is made by December 31, 2021, a 6% discount is allowed. If payment for 2023 season slips is made by December 31, 2021, renters get a 23% discount (this promotion hopefully will provide cash flow for major dock repairs). On December 31, 2020, all 300 slips for the 2021 season were rented at full price. On December 31, 2021, 196 slips were reserved and paid for the 2022 boating season, and 62 slips were reserved and paid for the 2023 boating season. (a) Prepare the appropriate journal entries for December 31, 2020, and December 31, 2021. (Round answers to 0 decimal places, eg. 5,275. Credit account titles are automatically indented when…
