Sheridan Co. 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 service contract revenues. This account had a balance of $964000 at December 31, 2024 before year-end adjustment. Service contract costs are charged as incurred to the service contract expense account, which had a balance of $237000 at December 31, 2024. Outstanding service contracts at December 31, 2024 expire as follows: During 2025 During 2026 During 2027 $205000 $316000 $140000 What amount should be reported as unearned service contract revenues in Sheridan's December 31, 2024 balance sheet? $489000. $440000. $727000. $661000

Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter9: Current Liabilities And Contingent Obligations
Section: Chapter Questions
Problem 1MC: The balance in Ashwood Companys accounts payable account at December 31, 2019, was 1,200,000 before...
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Sheridan Co. 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 service contract revenues. This account had a balance of $964000 at December 31,
2024 before year-end adjustment. Service contract costs are charged as incurred to the service
contract expense account, which had a balance of $237000 at December 31, 2024. Outstanding
service contracts at December 31, 2024 expire as follows:
During 2025 During 2026 During 2027
$205000 $316000 $140000
What amount should be reported as unearned service contract revenues in Sheridan's December
31, 2024 balance sheet?
$489000.
$440000.
$727000.
$661000
Transcribed Image Text:Sheridan Co. 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 service contract revenues. This account had a balance of $964000 at December 31, 2024 before year-end adjustment. Service contract costs are charged as incurred to the service contract expense account, which had a balance of $237000 at December 31, 2024. Outstanding service contracts at December 31, 2024 expire as follows: During 2025 During 2026 During 2027 $205000 $316000 $140000 What amount should be reported as unearned service contract revenues in Sheridan's December 31, 2024 balance sheet? $489000. $440000. $727000. $661000
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