On July 8, Azure Corporation enters into an agreement with one of its customers, Madsen, Inc. to provide them with 4,500 units at a cost of $500 per unit. Madsen sends a cash deposit of $225,000 on the same day. Azure sends the first 2,700 units on August 31, with an invoice for $675,000 due September 15. The remaining 1,800 units are delivered on October 15, along with an invoice for the remaining amount of the total $2,250,000 purchase price, due October 31. Madsen made all payments. on the invoice due dates. Assume that Azure Corporation had no uncertainties about its own ability to meet the terms of the contract or about Madsen, Inc.'s ability and willingness to pay. Prepare the journal entries to record the events (leaving out the accounting for Azure's costs). Date July 8 August 31 September 15 October 15 October 31 Account To record the deposit. To record initial delivery of units. To collect cash on account. To record delivery of remaining units. To collect cash on account. Debit Credit

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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On July 8, Azure Corporation enters into an agreement with one of its customers, Madsen, Inc. to provide them with 4,500
units at a cost of $500 per unit. Madsen sends a cash deposit of $225,000 on the same day. Azure sends the first 2,700 units
on August 31, with an invoice for $675,000 due September 15. The remaining 1,800 units are delivered on October 15, along
with an invoice for the remaining amount of the total $2,250,000 purchase price, due October 31. Madsen made all payments
on the invoice due dates. Assume that Azure Corporation had no uncertainties about its own ability to meet the terms of the
contract or about Madsen, Inc.'s ability and willingness to pay.
Prepare the journal entries to record the events (leaving out the accounting for Azure's costs).
Date
July 8
August 31
September 15
October 15
October 31
Account
To record the deposit.
To record initial delivery of units.
To collect cash on account.
To record delivery of remaining units.
To collect cash on account.
Debit
Credit
Transcribed Image Text:On July 8, Azure Corporation enters into an agreement with one of its customers, Madsen, Inc. to provide them with 4,500 units at a cost of $500 per unit. Madsen sends a cash deposit of $225,000 on the same day. Azure sends the first 2,700 units on August 31, with an invoice for $675,000 due September 15. The remaining 1,800 units are delivered on October 15, along with an invoice for the remaining amount of the total $2,250,000 purchase price, due October 31. Madsen made all payments on the invoice due dates. Assume that Azure Corporation had no uncertainties about its own ability to meet the terms of the contract or about Madsen, Inc.'s ability and willingness to pay. Prepare the journal entries to record the events (leaving out the accounting for Azure's costs). Date July 8 August 31 September 15 October 15 October 31 Account To record the deposit. To record initial delivery of units. To collect cash on account. To record delivery of remaining units. To collect cash on account. Debit Credit
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