Microsoft Word -Merlin X C Facts Merlint\'s Marketing xX t-rid-62730461 00172018
ID: 2548369 • Letter: M
Question
Microsoft Word -Merlin X C Facts Merlint's Marketing xX t-rid-62730461 0017201840/Merlin%27 INAL%2020 18%2002%2007.pdf RES G Devue g: Mail, chil isao03@c 1 Digital Wallet ! Bely Fat and Weight Dwcsu. Course Eu ? All Channels. XFINT MM's CFO is trying to understand the new revenue recognition rules and has asked youto explain how MM would account for the contract with Pearl under the new standard. Assignment Requirements: A. Prepare Professional Research Memorandum Prepare a professional accounting research memorandum in proper form with reference to the appropriate sections of the FASB codification. Review ASC 606 for the five steps in the revenue recognition model paying special attention to ASC Topics 606-10-32-2 through 9, ASC Topics 606-10-25-19 through 29, ASC Topics 606-10-32- 31 through 35 and ASC 606-10-32-39 through 41. For each of the five steps Analyze how each revenue model step applies to this transaction. Refer to the proper ASC Topic section in your memo. For any step that is not applicable, simply indicate it is not applicable. o Draw a conclusion as to whether the requirements for that step will be be met. Show any computations used in describing your conclusion. o met or will not B. Prepare Journal Entries (Pro Forma-What if) Provide Journal Entries (using the journal entry template) to record the receipt of cash and the amount of revenue that should be recognized at each of the following dates. Provide detailed computations of the revenue recognition amounts where appropriate August 1, 2017, MM receives $750,000 payment from Pearl upon signing contract. Entries for the quarter ending September 30, 2017, including any entry that may have been required at August 22, 2017 when MM delivered the Facebook page to Pearl November 1, 2017, MM receives second payment of $375,000 from Pearl Entries for the quarter ending December 31, 2017, including any entry that was required at October 31, 2017when MM delivers the Mobile App to Pearl Entries at January 31, 2018, when the Data Analytics Dashboard is delivered, and final cash payment is due. Remember that any incentive payment is due at this time. 1. 2. 3. 4. 5. Page 3 of 4Explanation / Answer
journal Entries;
Serial number Date Accounts Titles debit $ credit $ 1 Aug 1 2017 Cash 750000 Pearl - contract 750000 (being payment received from Pearl on signing contract) 2 No Entry 3 Nov 1 2017 Cash 375000 Pearl - contract 375000 (being second payment received from Pearl) 4 No Entry 5 No Entry