College Accounting (Book Only): A Career Approach
12th Edition
ISBN: 9781305084087
Author: Cathy J. Scott
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 11, Problem 2A
To determine
Explain the unearned revenue and identify the account type for unearned revenue.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Ms. Andrews is a customer of the Edsell Company. In the object-oriented design approach
A.
Ms. Andrews is an instance in the object class accounts receivable
B.
the amount Ms. Andrews owes the Edsell Company is an operation
C.
determining the amount past due is an attribute
D.
the object class accounts receivable inherits all the attributes of Ms. Andrews
In the case of sales where the customer is billed before delivery of the goods,
the seller should always recognize revenue before the products are delivered to the customer.
the goods belong to the customer and revenue recognition is deferred until delivery.
the seller may recognize revenue if control of the goods has been transferred to the customer even though physical delivery has not taken place.
revenue will not be recognized until the goods are shipped to the customer.
Teal Company is presently testing a number of new agricultural seed planters that it has recently developed. To stimulate interest, it
has decided to grant to five of its largest customers the unconditional right of return to these products if not fully satisfied. The right of
return extends for 4 months. Teal estimates returns of 20%. Teal sells these planters on account for $1,500,000 (cost $825,000) on
January 2, 2020. Customers are required to pay the full amount due by March 15, 2020.
Your answer is correct.
Prepare the journal entry for Teal at January 2, 202o. (Credit account titles are automatically indented when 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.)
Date
Account Titles and Explanation
Debit
Credit
Jan. 2,
Accounts Receivable
1,500,000
2020
Sales Revenue
1,500,000
(To recognize revenue.)
Cost of Goods Sold
825000
Inventory
825000
(To record cost of goods sold.)
eTextbook and…
Chapter 11 Solutions
College Accounting (Book Only): A Career Approach
Ch. 11 - Which of the following is the adjusting entry for...Ch. 11 - The adjusting entry for unearned revenue pertains...Ch. 11 - An account that has unearned in its name is...Ch. 11 - This type of inventory system does not require an...Ch. 11 - The Supplies account has a 1,400 balance. A...Ch. 11 - Prob. 6QYCh. 11 - Prob. 7QYCh. 11 - What is a physical inventory? What does the word...Ch. 11 - Prob. 2DQCh. 11 - Using the perpetual inventory system, what account...
Ch. 11 - Prob. 4DQCh. 11 - Prob. 5DQCh. 11 - Why is it necessary to adjust the Merchandise...Ch. 11 - A merchandising company shows 8,842 in the...Ch. 11 - Prob. 8DQCh. 11 - Prob. 1ECh. 11 - On October 31, the Vermillion Igloos Hockey Club...Ch. 11 - Basga Company uses the periodic inventory system....Ch. 11 - Prob. 4ECh. 11 - Journalize the required adjusting entries for the...Ch. 11 - On December 31, the end of the year, the...Ch. 11 - On December 31, Marchant Company took a physical...Ch. 11 - The trial balance of Hadden Company as of December...Ch. 11 - The balances of the ledger accounts of Beldren...Ch. 11 - Prob. 3PACh. 11 - Here are the accounts in the ledger of Mishas...Ch. 11 - A portion of Anderson Publishings work sheet for...Ch. 11 - The trial balance of Jillson Company as of...Ch. 11 - The balances of the ledger accounts of Pelango...Ch. 11 - Prob. 3PBCh. 11 - The accounts and their balances in the ledger of...Ch. 11 - A portion of Johnsons Farm Supply work sheet for...Ch. 11 - BURTS BEES, Durham, North Carolina Burts Bees...Ch. 11 - Prob. 2ACh. 11 - Prob. 3ACh. 11 - Prob. 4ACh. 11 - Prob. 5ACh. 11 - Prob. 1CP
Knowledge Booster
Similar questions
- Explain why companies must use the Allowance Method, and not the Direct Write-Off Method, when dealing with collectible accounts. Then show a journal entry writing off an account with both methods. Note: Please see below as I don't believe what I came up with is detailed enough. Please include actual amounts for this problem. The amounts can be made up, but a journal entry utilizing both methods must be included. Let's assume that a corporation begins operations on November 1 in an industry where it is common to give credit terms of net 30 days. In this industry, approximately 0.3% of credit sales will not be collected. Next, let's assume that the corporation focuses on the bad debts expense. If the corporation's actual credit sales for November are $800,000, it will record an adjusting entry dated November 30 to debit the bad debts expense for $2,400 ($800,000 X 0.003) and credit an allowance for doubtful accounts in the amount of $2,400. As a result, its November income statement…arrow_forwardplease help...need help finding noncash assetsarrow_forwardCyber Systems’ management has been actively pursuing clients who fail to pay invoices when they fall due. Based on the experience of Cyber Systems in the 2021 financial year which ends on June 30, the longer an account receivable is outstanding, the more likely the client never pays the amount due. The longer the account is due, the more likely the client closes their travel agency and can never pay amounts due to Cyber Systems. Answer the following: (a) Identify the method and approach that is appropriate to account for bad debts in this case. (b) With reference to three relevant accounting principles, assumptions and/or qualitative characteristics, justify why the method and approach you have identified in part (a) is appropriate. Clearly label each part of your answer related to parts a and b above. In particular for part b, structure your answer as follows for each of the three relevant accounting principles, assumptions and/or qualitative characteristics:Identify accounting…arrow_forward
- Before paying an invoice for goods received on account, the controller or treasurershould ensure thata. the company is paying for the goods it actually received.b. the company is paying for the goods it ordered.c. the company has not already paid this invoice.d. all of the above.arrow_forwardOnly typed solution. When an attest client has unpaid fees that are over one year past due, what is required? A) There are no requirements in this situationB) Obtain a note receivable from the clientC) Move forward with the attest work as long as the client says they will pay us soonD) Consult with National Independencearrow_forwardMay you please help me determine which statements are false or true?arrow_forward
- Read the following statements carefully: Recalculate the allowance of accounts receivables. Vouch sales journal entries to sales invoices. Inspect the Bank statement in the client’s file. Trace sales invoices to accounting receivable ledger. Ask the payroll department to make a report about the calculating criteria of the overtime. Inspect the disclosure of inventories in the financial statements. Ask management about inventories the client has a legal title on it. Observe that Inventory quantities include all products, materials, and supplies on hand. Instructions: 1-Indicate the type of Procedure for each statement. 2-Indicate the type of Evidence for each statement. 3-Indicate the type of Assertion for each statement. 4-Indicate the source of Document for each statement (obtained directly by the auditor, external circulated internally, internally circulated externally, entirely internal). No. Type of Procedure Type of Evidence Type of Assertion The source of…arrow_forwardAll of the following are true concerning an invoice except: When a shipment arrives, the receiving department counts the items received against the purchase order. The vendor ships items ordered after it receives a purchase requisition. The invoice is sent to the buyer's accounting department where it is placed in the voucher. Ⓒ When all coples are in the voucher, the accounting department can record the purchase and approve its payment.arrow_forwardWhich of the following are external threats to revenue security? (select all that apply) A guest who walks out before the bill is presented An employee using voided sales to steal cash A quick-change artist A guest who forgot to payarrow_forward
- Jackie owns a temporary employment agency that hires personnel to perform accounting services for clients. During the year, her expenses for her clients include the following: Cab fare to and from restaurants Gratuity at restaurants Meals Cover charges All expenses are reasonable. Required: a. How much of these expenses can Jackie deduct? b. How is the deduction classified? Required A Complete this question by entering your answers in the tabs below. Required B Cab fare to and from restaurants Gratuity at restaurants Meals Cover Charges Total deduction How much of these expenses can Jackie deduct? Note: Leave no cells blank. Enter "0" wherever required. $ 450 400 4,500 350 Answer is complete but not entirely correct. $ $ $ $ $ 450✔ 200 x 2,250 X 175 X 3,075 Xarrow_forwardABC Company has shipped goods to one of its customers FOB destination. ABC Company will recognize sales revenue when: O their customer has received and inspected the goods. O the customer pays the invoice. O the goods leave ABC's shipping dock. the two parties agree that revenue should be recognized. O the goods are received by the customer.arrow_forward1. Please explain whether the item is an example of IPE from a transaction process, and 2. Please explain why or why not in some level of detail: Item IPE? Why or why not? A. A payroll exception report prepared by ADP B. A report containing new vendors approved by the purchasing department C. An unpaid vendor invoice D. A list of product liability claims from customers E. The allocation of overhead to various products in production F. Warranty conditions provided to customers on sales contracts G. The bank reconciliation prepared by the Company's bankarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
Auditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Auditing: A Risk Based-Approach (MindTap Course L...
Accounting
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Cengage Learning