Problem 18-5 (Part Level Submission) Warning Don\'t show me this message again f
ID: 2563314 • Letter: P
Question
Problem 18-5 (Part Level Submission)
Warning
Don't show me this message again for the assignment
Ok Cancel
(a)
Account Titles and Explanation
Debit
Credit
(To record sales)
(To record cost of goods sold)
Warning
Don't show me this message again for the assignment
Ok Cancel
Show List of Accounts
Show Solution
Show Answer
Link to Text
Link to Text
Link to Text
(b)
Account Titles and Explanation
Debit
Credit
(To record sales)
(To record cost of goods sold)
Warning
Don't show me this message again for the assignment
Ok Cancel
Show List of Accounts
Show Solution
Show Answer
Link to Text
Link to Text
Link to Text
(c)
Date
Account Titles and Explanation
Debit
Credit
Jun. 20, 2017
(To record payment received)
(To record sales)
(To record cost of goods sold)
Problem 18-5 (Part Level Submission)
Flounder Ranch & Culver is a distributor of ranch and farm equipment. Its products range from small tools, power equipment for trench-digging and fencing, grain dryers, and barn winches. Most products are sold direct via its company catalog and Internet site. However, given some of its specialty products, select farm implement stores carry Flounder’s products. Pricing and cost information on three of Flounder’s most popular products are as follows.Item Standalone
Selling Price (Cost) Mini-trencher $ 4,000 ($2,000 ) Power fence hole auger 1,300 (800 ) Grain/hay dryer 13,600 (10,800 )
Respond to the requirements related to the following independent revenue arrangements for Flounder Ranch & Culver.
Warning
Don't show me this message again for the assignment
Ok Cancel
(a)
Your answer is correct. On January 1, 2017, Flounder sells 30 augers to Mills Farm & Fleet for $39,000. Mills signs a 6-month note at an annual interest rate of 12%. Flounder allows Mills to return any auger that it cannot use within 50 days and receive a full refund. Based on prior experience, Flounder estimates that 5% of units sold to customers like Mills will be returned (using the most likely outcome approach). Flounder’s costs to recover the products will be immaterial, and the returned augers are expected to be resold at a profit. Prepare the journal entry for Flounder on January 1, 2017. (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
Notes Receivable
39000
Sales Revenue
39000
(To record sales)
Cost of Goods Sold
24000
Inventory
24000
(To record cost of goods sold)
Warning
Don't show me this message again for the assignment
Ok Cancel
Show List of Accounts
Show Solution
SHOW ANSWER HIDDENShow Answer
Link to Text
Link to Text
Link to Text
Attempts: 1 of 3 used(b)
Your answer is correct. On August 10, 2017, Flounder sells 16 mini-trenchers to a farm co-op in western Minnesota. Flounder provides a 4% volume discount on the mini-trenchers if the co-op has a 15% increase in purchases from Flounder compared to the prior year. Given the slowdown in the farm economy, sales to the co-op have been flat, and it is highly uncertain that the benchmark will be met. Prepare the journal entry for Flounder on August 10, 2017. (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. Round intermediate calculations to 6 decimal places, e.g. 1.246576 and final answers to 0 decimal places, e.g. 5,125.)Account Titles and Explanation
Debit
Credit
Cash
64000
Sales Revenue
64000
(To record sales)
Cost of Goods Sold
32000
Inventory
32000
(To record cost of goods sold)
Warning
Don't show me this message again for the assignment
Ok Cancel
Show List of Accounts
Show Solution
SHOW ANSWER HIDDENShow Answer
Link to Text
Link to Text
Link to Text
Attempts: 1 of 3 used(c)
Flounder sells three grain/hay dryers to a local farmer at a total contract price of $44,300. In addition to the dryers, Flounder provides installation, which has a standalone selling price of $1,100 per unit installed. The contract payment also includes a $1,200 maintenance plan for the dryers for 3 years after installation. Flounder signs the contract on June 20, 2017, and receives a 20% down payment from the farmer. The dryers are delivered and installed on October 1, 2017, and full payment is made to Flounder. Prepare the journal entries for Flounder in 2017 related to this arrangement. (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.)Date
Account Titles and Explanation
Debit
Credit
Jun. 20, 2017
Jun. 20, 2017Oct. 1, 2017Dec. 31, 2017
(To record payment received)
(To record sales)
(To record cost of goods sold)
Jun. 20, 2017Oct. 1, 2017Dec. 31, 2017
Explanation / Answer
Date Account Titles and Explanation Debit Credit
Jun. 20, 2017 Cash 8,620
A/R 34,480
Unearned Revenue 43,100
Oct 1, 2017 Cash 34,480
A/R 34,480
Oct 1, 2017 Unearned Revenue 41,933
Revenue Dryers 38,722
Revenue Installation 3,211
Dec 31, 2017 Unearned Revenue 292
Revenue maintenance 292
Working Note:
Standalone Sales Value
Proportion
Total Price
Amount Allocated
3
Dryers
39,800
89.84%
43,100
38,722
3
Installations
3,300
7.45%
3,211
1
Maintenance
1,200
2.71%
1,167
44,300
100.00%
43,100
43,100
Standalone Sales Value
Proportion
Total Price
Amount Allocated
3
Dryers
39,800
89.84%
43,100
38,722
3
Installations
3,300
7.45%
3,211
1
Maintenance
1,200
2.71%
1,167
44,300
100.00%
43,100
43,100