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On September 25, land Dist butors receives an order from Sarasota Ita

On September 25, land Dist butors receives an order from Sarasota Ita

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On September 25, Sunland Distributors receives an order from Sarasota Italian Supermarkets for 124 cases of extra virgin olive oil. Sunland accepts the order, which needs to be delivered to Sarasota's warehouse, and Sarasota agrees to pay within 30 days of the receipt of the product. Each case of extra virgin olive oil contains 12 bottles at a selling price of $7.00 each. Sunland's cost is $3/ bottle. The shipment is received at Sarasota's warehouse on October 2, and Sarasota mails a cheque to Sunland at the end of the agreed upon payment terms. Sunland Distributors used a contact-based approach to revenue recognition. Determine if there is a contract between Sunland Distributors and Sarasota Italian Supermarkets. If there is a contract, record Sunland's entries related to these transactions. (If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List debit entries before credit entries.) Date Account Titles and Explanation Sep. 25 Oct. 2 Oct. 2 Oct. 31 (To record sales on credit) (To record cost of goods sold) Debit 11 Credit
Transcribed Image Text:On September 25, Sunland Distributors receives an order from Sarasota Italian Supermarkets for 124 cases of extra virgin olive oil. Sunland accepts the order, which needs to be delivered to Sarasota's warehouse, and Sarasota agrees to pay within 30 days of the receipt of the product. Each case of extra virgin olive oil contains 12 bottles at a selling price of $7.00 each. Sunland's cost is $3/ bottle. The shipment is received at Sarasota's warehouse on October 2, and Sarasota mails a cheque to Sunland at the end of the agreed upon payment terms. Sunland Distributors used a contact-based approach to revenue recognition. Determine if there is a contract between Sunland Distributors and Sarasota Italian Supermarkets. If there is a contract, record Sunland's entries related to these transactions. (If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List debit entries before credit entries.) Date Account Titles and Explanation Sep. 25 Oct. 2 Oct. 2 Oct. 31 (To record sales on credit) (To record cost of goods sold) Debit 11 Credit
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