Sandhill Company sells goods that cost $275,000 to Indigo Company for $440,000 on January 2, 2020. The sales price includes an installation fee, which is valued at $41,400. The fair value of the goods is $408,600. The goods were delivered on March 1, 2020. Installation is considered a separate performance obligation and was completed on June 18, 2020. Under the terms of the contract, Indigo Company pays Sandhill $260,000 upon delivery of the goods and the balance at the completion of the installation.
Sandhill Company sells goods that cost $275,000 to Indigo Company for $440,000 on January 2, 2020. The sales price includes an installation fee, which is valued at $41,400. The fair value of the goods is $408,600. The goods were delivered on March 1, 2020. Installation is considered a separate performance obligation and was completed on June 18, 2020. Under the terms of the contract, Indigo Company pays Sandhill $260,000 upon delivery of the goods and the balance at the completion of the installation.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Sandhill Company sells goods that cost $275,000 to Indigo Company for $440,000 on January 2, 2020. The sales price includes an installation fee, which is valued at $41,400. The fair value of the goods is $408,600. The goods were delivered on March 1, 2020. Installation is considered a separate performance obligation and was completed on June 18, 2020. Under the terms of the contract, Indigo Company pays Sandhill $260,000 upon delivery of the goods and the balance at the completion of the installation.
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