Problem 1-19 (AICPA Adapted) Ryan Company sells major household appliance service contracts for cash. The service contracts are for a one-year, two-year, or three-year period. Cash receipts from contracts are credited to unearned contract revenue. This account had a balance of P720,000 on December 31, 2020 before year-end adjustment. Service contract costs are charged as incurred to service contract expense account which had a balance of P180,000. Outstanding servicé contracts on December 31, 2020 expire during 2021 P150,000, during 2022 P225,000 and during 2023 P100,000. What amount should be reported as unearned contract revenue on December 31, 2020? а. 540,000 b. 475,000/ с. 295,000 d. 245,000 25
Problem 1-19 (AICPA Adapted) Ryan Company sells major household appliance service contracts for cash. The service contracts are for a one-year, two-year, or three-year period. Cash receipts from contracts are credited to unearned contract revenue. This account had a balance of P720,000 on December 31, 2020 before year-end adjustment. Service contract costs are charged as incurred to service contract expense account which had a balance of P180,000. Outstanding servicé contracts on December 31, 2020 expire during 2021 P150,000, during 2022 P225,000 and during 2023 P100,000. What amount should be reported as unearned contract revenue on December 31, 2020? а. 540,000 b. 475,000/ с. 295,000 d. 245,000 25
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
PLEASE ANSWER AND SHOW SOLUTIONS
Transcribed Image Text:Problem 1-19 (AICPA Adapted)
Ryan Company sells major household appliance service
contracts for cash. The service contracts are for a one-year,
two-year, or three-year period. Čash receipts from contracts
are credited to unearned contract revenue. This account had
a balance of P720,000 on December 31, 2020 before year-end
adjustment. Service contract costs are charged as incurred
to service contract expense account which had a balance of
P180,000. Outstanding servicé contracts on December 31,
2020 expire during 2021 P150,000, during 2022 P225,000 and
during 2023 P100,000.
What amount should be reported as unearned contract
revenue on December 31, 2020?
а. 540,000
b. 475,000/
с. 295,000
d. 245,000
25
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education