Sunland Appliance Co. manufactures low-price, no-frills appliances that are in great demand for rental units. Pricing and cost information on Sunland's main products are as follows. Item Refrigerator Range Stackable washer/dryer unit Stand-Alone Selling Price (Cost) $520 ($245) $610 ($330) $780 ($440) Customers can contract a purchase either individually at the stated prices or for a three-item bundle with a price of $1,950. The bundle price includes delivery and installation. Sunland provides delivery and installation as a stand-alone service for any of its products for $90. The company follows IFRS. Respond to the requirements related to the following independent revenue arrangements for Sunland. (a) On June 1, 2023, Sunland sold 90 washer/dryer units without installation to Sandhill Rentals for $70,200 (on credit). Sandhill is a newer customer and is unsure of how this product will work in its older rental units. Sunland offers a 60-day return privilege and estimates, based on prior experience with sales of this product, that 3% of the units will be returned. Prepare the journal entries for the sale and related cost of goods sold on June 1, 2023. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries 1
Sunland Appliance Co. manufactures low-price, no-frills appliances that are in great demand for rental units. Pricing and cost information on Sunland's main products are as follows. Item Refrigerator Range Stackable washer/dryer unit Stand-Alone Selling Price (Cost) $520 ($245) $610 ($330) $780 ($440) Customers can contract a purchase either individually at the stated prices or for a three-item bundle with a price of $1,950. The bundle price includes delivery and installation. Sunland provides delivery and installation as a stand-alone service for any of its products for $90. The company follows IFRS. Respond to the requirements related to the following independent revenue arrangements for Sunland. (a) On June 1, 2023, Sunland sold 90 washer/dryer units without installation to Sandhill Rentals for $70,200 (on credit). Sandhill is a newer customer and is unsure of how this product will work in its older rental units. Sunland offers a 60-day return privilege and estimates, based on prior experience with sales of this product, that 3% of the units will be returned. Prepare the journal entries for the sale and related cost of goods sold on June 1, 2023. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries 1
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Sunland Appliance Co. manufactures low-price, no-frills appliances that are in great demand for rental units. Pricing and cost
information on Sunland's main products are as follows.
Item
Refrigerator
Range
Stackable washer/dryer unit
Stand-Alone Selling Price (Cost)
$520 ($245)
$610 ($330)
$780 ($440)
Customers can contract a purchase either individually at the stated prices or for a three-item bundle with a price of $1,950. The
bundle price includes delivery and installation. Sunland provides delivery and installation as a stand-alone service for any of its
products for $90. The company follows IFRS.
Respond to the requirements related to the following independent revenue arrangements for Sunland.
(a)
On June 1, 2023, Sunland sold 90 washer/dryer units without installation to Sandhill Rentals for $70,200 (on credit). Sandhill is a
newer customer and is unsure of how this product will work in its older rental units. Sunland offers a 60-day return privilege and
estimates, based on prior experience with sales of this product, that 3% of the units will be returned. Prepare the journal entries
for the sale and related cost of goods sold on June 1, 2023. (Credit account titles are automatically indented when the amount is
entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit
entries before credit entries.)
Date Account Titles and Explanation
Debit
Credit
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