E5-10B. New Revenue Recognition Standard—Adjusting Journal Entries PrimeTech sold $2,000,000 of merchandise on account during the...
E5-10B. New Revenue Recognition Standard—Adjusting Journal Entries
PrimeTech sold $2,000,000 of merchandise on account during the current year. The cost for this merchandise to PrimeTech was $600,000. To encourage early payment from its customers, PrimeTech offers credit terms of 2/10, n/30. At year-end, PrimeTech recognizes that there are $200,000 of sales on account still eligible for the 2 percent discount. PrimeTech believes that all customers will pay within the discount period to receive this discount. In addition, PrimeTech allows a 60-day return privilege for the merchandise it sells. At year-end, PrimeTech estimates there remain $450,000 of sales (with a cost to PrimeTech of $135,000) that are still within the 60-day return period and that, based on past experience, 7 percent of this merchandise is expected to be returned.
Prepare the period-end adjusting journal entries needed for PrimeTech to comply with the new revenue recognition standard. Assume PrimeTech’s fiscal year-end is December 31.
(Please explain/walk through how the debit and credit values are calculated)
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E5-10B. New Revenue Recognition Standard—Adjusting
Journal Entries
PrimeTech sold $2,000,000 of merchandise on account during the...
will pay within the discom Juul til alle believes that all companies thin the discount period. Additionally, Carri...
will pay within the discom Juul til alle believes that all companies thin the discount period. Additionally, Carrie allows a 90-day return nrivilege for hany, came allows a 90-day return privilege for the mer- dise it sells. At year-end, Carrie estimates sales of $1,200,000 (with a cost to Ca are still within the 90-day return period. From past experience, 6 percent of this merchan- enected to be returned. Prepare the period-end adjusting journal entries needed for Carrie to comply with...
mann stores returned goods that had been billed orifinally at 800 263 Chapter 5 Accounting for...
mann stores returned goods that had been billed orifinally at 800
263 Chapter 5 Accounting for Merchandising Operations $410,000 of sales on account still eligible for the percent discount at year-end and believes that all companies will pay within the discount period. Additionally Butler allows a 90-day return privice for the merchandiselt sells. At year-end, Butler estimates sales of $1.200.000 (with a cost to utro $480,000) remain that are still within the 90-day return neried. From past experience, 6 percent...
i Requirements Prepare the journal entries for Canton Company for the sale of the merchandise, the...
i Requirements Prepare the journal entries for Canton Company for the sale of the merchandise, the cost of the sale, and the related receipt of payment from Spring Corporation. Assume that Spring Corporation takes the discount if payment is within the discount period. Indicate which company (Canton or Spring) owns the merchandise at the end of each of the following dates: a. April 3 b. April 4 c. April 10 (Assume that Canton Company uses the gross method of recording...
Problem 2. Merchandising General Journal Entries (30 points) epare general journal entries to record the following...
Problem 2. Merchandising General Journal Entries (30 points) epare general journal entries to record the following merchandising transactions of Margin Company, which applies the perpetual inventory system and the gross method of recording invoices. Margin Company offers all of its credit customers credit terms of 2/10, n/30. May 2] Purchased May 1 P urchased merchandise from Craft Company for $7,800 under credit terms of 1/10, n/30, FOB shipping point, invoice dated May 1. Purchased merchandise from Bow Company for $10,600...
Exercise 23 Prepare adjusting entries for the following transactions. Credit account ties are automatically indented when...
Exercise 23 Prepare adjusting entries for the following transactions. Credit account ties are automatically indented when the amount is entered. Do not indent manually. If na entry is required, selecta amount) entry for the account titles and enter a forche 1. Unrecorded interest accrued on savings bonds is 5360 Property taxes incurred but not paid or recorded amount to $704 Unearned service revenue of $3,520 was collected in advance. By year and $516 was still unearned. Prepaid insurance had a...
1. Prepare adjusting entries for the following transactions. (Credit account titles are automatically indented when Unrecorded...
1. Prepare adjusting entries for the following transactions. (Credit account titles are automatically indented when Unrecorded interest accrued on savings bonds is $488. Property taxes incurred but not paid or recorded amount to $976. 3. Unearned service revenue of $4,880 was collected in advance. By year end $854 was still unearned. Prepaid insurance had a $915 debit balance prior to adjustment. By year end, 60 percent was still unexpired. 5. Salaries incurred by year end but not yet paid or...
ACCT 101a Chapter 3 - Adjusting entries In the General Journal, record adjusting journal entries for...
ACCT 101a Chapter 3 - Adjusting entries In the General Journal, record adjusting journal entries for the following items for Sunny Inc. at December 31, 2018. 1. On January 2, 2018 Sunny Inc. accepted a $17,500 deposit from a client for design work to be completed during the year. On December 31, 2018 all the design work for the client is complete. 2. On December 31, 2018 the bill for gas was received but not yet paid. Amount is $375....
Revenue Recognition Indicate which of the following transactions or events gives rise to the recognition of...
Revenue Recognition Indicate which of the following transactions or events gives rise to the recognition of revenue in 2015 under the accrual basis of accounting. If revenue is not recognized, what account, if any, is credited? (a) On December 15, 2015, Howe Company received $20,000 as rent revenue for the six-month period beginning January 1, 2016. (b) Monroe Tractor Co., on July 1, 2015, sold one of its tractors and received $10,000 in cash and a note for $50,000 at...
- X i Requirements 1. Prepare the journal entries for Redstone Company for the sale of...
- X i Requirements 1. Prepare the journal entries for Redstone Company for the sale of the merchandise, the cost of the sale, and the related receipt of payment from Milton Corporation. Assume that Milton Corporation takes the discount if payment is within the discount period. 2. Indicate which company (Redstone or Milton) owns the merchandise at the end of each of the following dates: a. April 3 b. April 4 c. April 10 (Assume that Redstone Company uses the...
Adjusting Entries for Interest The following note transactions occurred during the year for Zuber Company: Nov....
Adjusting Entries for Interest The following note transactions occurred during the year for Zuber Company: Nov. 25 Zuber issued a 90-day, 10% note payable for $60,000 to Porter Company for merchandise. Dec 10 Zuber signed a 120-day, 10% note at the bank for $72,000. Dec. 23 Zuber gave Dale, Inc, a 60 day, 12% 590,000 note for payment of account. Prepare the journal entries necessary to adjust the interest accounts at December 31. Use 360 days for calculations and round...
will pay within the discom Juul til alle believes that all companies thin the discount period. Additionally, Carrie allows a 90-day return nrivilege for hany, came allows a 90-day return privilege for the mer- dise it sells. At year-end, Carrie estimates sales of $1,200,000 (with a cost to Ca are still within the 90-day return period. From past experience, 6 percent of this merchan- enected to be returned. Prepare the period-end adjusting journal entries needed for Carrie to comply with...
mann stores returned goods that had been billed orifinally at 800
263 Chapter 5 Accounting for Merchandising Operations $410,000 of sales on account still eligible for the percent discount at year-end and believes that all companies will pay within the discount period. Additionally Butler allows a 90-day return privice for the merchandiselt sells. At year-end, Butler estimates sales of $1.200.000 (with a cost to utro $480,000) remain that are still within the 90-day return neried. From past experience, 6 percent...
i Requirements Prepare the journal entries for Canton Company for the sale of the merchandise, the cost of the sale, and the related receipt of payment from Spring Corporation. Assume that Spring Corporation takes the discount if payment is within the discount period. Indicate which company (Canton or Spring) owns the merchandise at the end of each of the following dates: a. April 3 b. April 4 c. April 10 (Assume that Canton Company uses the gross method of recording...
Problem 2. Merchandising General Journal Entries (30 points) epare general journal entries to record the following merchandising transactions of Margin Company, which applies the perpetual inventory system and the gross method of recording invoices. Margin Company offers all of its credit customers credit terms of 2/10, n/30. May 2] Purchased May 1 P urchased merchandise from Craft Company for $7,800 under credit terms of 1/10, n/30, FOB shipping point, invoice dated May 1. Purchased merchandise from Bow Company for $10,600...
Exercise 23 Prepare adjusting entries for the following transactions. Credit account ties are automatically indented when the amount is entered. Do not indent manually. If na entry is required, selecta amount) entry for the account titles and enter a forche 1. Unrecorded interest accrued on savings bonds is 5360 Property taxes incurred but not paid or recorded amount to $704 Unearned service revenue of $3,520 was collected in advance. By year and $516 was still unearned. Prepaid insurance had a...
1. Prepare adjusting entries for the following transactions. (Credit account titles are automatically indented when Unrecorded interest accrued on savings bonds is $488. Property taxes incurred but not paid or recorded amount to $976. 3. Unearned service revenue of $4,880 was collected in advance. By year end $854 was still unearned. Prepaid insurance had a $915 debit balance prior to adjustment. By year end, 60 percent was still unexpired. 5. Salaries incurred by year end but not yet paid or...
ACCT 101a Chapter 3 - Adjusting entries In the General Journal, record adjusting journal entries for the following items for Sunny Inc. at December 31, 2018. 1. On January 2, 2018 Sunny Inc. accepted a $17,500 deposit from a client for design work to be completed during the year. On December 31, 2018 all the design work for the client is complete. 2. On December 31, 2018 the bill for gas was received but not yet paid. Amount is $375....
- X i Requirements 1. Prepare the journal entries for Redstone Company for the sale of the merchandise, the cost of the sale, and the related receipt of payment from Milton Corporation. Assume that Milton Corporation takes the discount if payment is within the discount period. 2. Indicate which company (Redstone or Milton) owns the merchandise at the end of each of the following dates: a. April 3 b. April 4 c. April 10 (Assume that Redstone Company uses the...
Adjusting Entries for Interest The following note transactions occurred during the year for Zuber Company: Nov. 25 Zuber issued a 90-day, 10% note payable for $60,000 to Porter Company for merchandise. Dec 10 Zuber signed a 120-day, 10% note at the bank for $72,000. Dec. 23 Zuber gave Dale, Inc, a 60 day, 12% 590,000 note for payment of account. Prepare the journal entries necessary to adjust the interest accounts at December 31. Use 360 days for calculations and round...
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