Problem 10-13 (AICPA Adapted)On October 1, 2021, Grimm Company consigned 40 freezersto Holden Company costing P14,000 each for sale at P20,000each and paid P16,000 in transportation costs. On December30, 2021, Holden Company reported the sale of 10 freezersand remitted P170,000. The remittance was net of the agreed15% commission.What amount should be recorded as consignment salesrevenue for 2021?a. 154,000b. 170,000c. 196,000d. 200,000

solution concept In a consignment sale , the revenue shall be recorded at the gross amount that is…

Answered: Problem 10-13 (AICPA Adapted) On…

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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Assume Nortel Networks contracted to provide a customer with Internet infrastructure for $2,860,000. The project began in 2021 and was completed in 2022 Data relating to the contract are summarized below: 2021 $ 372,000 $1,899,00e 1,488,eee 524,000 318,eee 2022 Costs incurred during the year Estimated costs to complete as of 12/31 Billings during the year Cash collections during the year 2,336,800 2,542, 000 Required: 1. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue over time occording to percentege of completion. 2. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 ssuming this project does not qualify for revenue recognition over time. 3. Prepare a partial balance sheet to show how the information related to this contract would be presented ot the end of 2021 assuming Nortel recognizes revenue over time according to percentege of completion. 4. Prepare a partial…
M Corp. receives advance payments with special orders for containers constructed to customer specifications. Related information for 2022 is as follows ($ in millions): Customer advances balance, Dec. 31, 2021 $ 100 Advances received with 2022 orders 204 Advances applicable to orders shipped in 2022 189 Advances from orders canceled in 2022 53 What amount should M Corp. report as a current liability for advances from customers in its December 31, 2022, balance sheet? Multiple Choice $62 million. $0. $304 million. $115 million.
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Allocating Transaction Price to Performance Obligations and Recording Sales Value Dealership Inc. markets and sells the vehicles to retail customers. Along with a new vehicle purchase, a customer will receive a free annual maintenance contract for one year from the date of purchase. The standalone selling price of a vehicle is $30,000 and the standalone selling price for the annual maintenance contract is $400. During October 2020, Value Dealership Inc. sold 30 vehicles for $30,250 per vehicle, each with a free annual maintenance contract. When answering the following questions: Round each allocated transaction price to the nearest dollar. If a journal entry (or a line of the journal entry) isn't required for the transaction, select "N/A" as the account name and leave the Dr. and Cr. answers blank (zero). a. Ignoring the cost entries, record the journal entry in October 2020 for Value Dealership’s sale of vehicles with the associated maintenance contracts to customers.…
am. 111.
M5-13. Computing Revenues under Long-Term Contracts Camden Corporation agreed to build a warehouse for a client at an agreed contract price of $900,000. Ex- pected (and actual) costs for the warehouse follow: 2016, $202,500; 2017, $337,500; and 2018, $135,000. The company completed the warehouse in 2018. Compute revenues, expenses, and income for each year 2016 through 2018, and for all three years combined, using the cost-to-cost method.
Problem 9. At December 31, 2021, Cactus Co. had 10,000 gift certificates outstanding which had been sold to customers during 2021 for P100 each. Cactus operates on a gross margin of 60% of its sales. What amount of revenue pertaining to the 10,000 outstanding gift certificates should be deferred at December 31, 2021?

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