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Business Accounting Intermediate Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (2nd Edition)

Surfing the Standards Case 3: Time Shares Treasure Island Corporation (TIC) sells time shares in luxury oceanfront cottages. During the year ended December 31, 2017, TIC completed a project consisting of 100 cottages in a particularly scenic portion of Hawaii. The project cost TIC $110 24 million. During the current year, TIC sold 1,924 weekly time shares in the cottages for $40,000 each. TIC’s sales policy requires a 20% down payment, so TIC received $8,000 for each time share this year. Because TIC’s customers consist of only the most wealthy individuals, TIC does not anticipate any uncollectible accounts. Customers that purchased time shares will not make any more payments this year. TIC uses the full accrual method for revenue recognition purposes. Prepare a memo for the file discussing how to account for this transaction. Include a discussion of what the account balances should be related to this transaction. (Ignore any interest on the amounts due from customers.) Support your conclusions using the Codification.

Surfing the Standards Case 3: Time Shares Treasure Island Corporation (TIC) sells time shares in luxury oceanfront cottages. During the year ended December 31, 2017, TIC completed a project consisting of 100 cottages in a particularly scenic portion of Hawaii. The project cost TIC $110 24 million. During the current year, TIC sold 1,924 weekly time shares in the cottages for $40,000 each. TIC’s sales policy requires a 20% down payment, so TIC received $8,000 for each time share this year. Because TIC’s customers consist of only the most wealthy individuals, TIC does not anticipate any uncollectible accounts. Customers that purchased time shares will not make any more payments this year. TIC uses the full accrual method for revenue recognition purposes. Prepare a memo for the file discussing how to account for this transaction. Include a discussion of what the account balances should be related to this transaction. (Ignore any interest on the amounts due from customers.) Support your conclusions using the Codification.

Intermediate Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (2nd Edition)

Intermediate Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (2nd Edition)

2nd Edition

ISBN: 9780134833118

Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella

Publisher: PEARSON

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Chapter 10, Problem 3SSC

Surfing the Standards Case 3: Time Shares

Treasure Island Corporation (TIC) sells time shares in luxury oceanfront cottages. During the year ended December 31, 2017, TIC completed a project consisting of 100 cottages in a particularly scenic portion of Hawaii. The project cost TIC $110 24 million. During the current year, TIC sold 1,924 weekly time shares in the cottages for $40,000 each.

TIC’s sales policy requires a 20% down payment, so TIC received $8,000 for each time share this year. Because TIC’s customers consist of only the most wealthy individuals, TIC does not anticipate any uncollectible accounts. Customers that purchased time shares will not make any more payments this year. TIC uses the full accrual method for revenue recognition purposes.

Prepare a memo for the file discussing how to account for this transaction. Include a discussion of what the account balances should be related to this transaction. (Ignore any interest on the amounts due from customers.) Support your conclusions using the Codification.

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Chapter 10, Problem 2SSC

Chapter 10, Problem 4SSC

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Chapter 10 Solutions

Intermediate Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (2nd Edition)

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