Question

On May 1, 2020, Sage Inc. entered into a contract to deliver one of its specialty mowers to Kickapoo Landscaping Co. The contract requires Kickapo0 to pay the contract price of $913 in advance on May 15, 2020. Kickapoo pays Sage on May 15, 2020, and Sage delivers the mower (with cost of $563) on May 31, 2020. (a) Prepare the journal entry on May 1, 2020, for Sage. (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 0 for the amounts.) Account Titles and Explanation Debit Credit Date May 1, 2020 (b) Prepare the journal entry on May 15, 2020, for Sage. (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 0 for the amounts.) Account Titles and Explanation Debit Credit Date May 15, 2020 (c) Prepare the journal entry on May 31, 2020, for Sage. (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.) Date Account Titles and Explanation Debit Credit May 31, 2020 (To record sales) (To record cost of goods sold)

Answer 1

a)

Journal

May 1	No entry	0
			0

b)

Journal

May 15	Cash	913
	Unearned revenue		913

c)

Journal

May 31	Unearned revenue	913
	Sales		913
May 31	Cost of goods sold	563
	Inventory		563

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