Unearned Revenue and Customer Deposits}

On November 20, 2017, Manitoba Electronics agreed to manufacture and supply 750 electronic control units used by Wausau Heating Systems in large commercial and industrial installments. On that date, Wausau deposited \(\$ 250\) per unit upon signing the three-year purchase agreement, which set the selling price of each control unit at \(\$ 1,000\). Manitoba's inventory cost is \(\$ 225\) per unit. No units were delivered during 2017. The first 200 units will be delivered in 2018,300 units will be delivered during 2019, and the remaining units will be delivered during 2020. Assume Manitoba uses a perpetual inventory system.

\section*{Required:}

1. CONCEPTUAL CONNECTION Prepare the entry by Manitoba to record receipt of the deposit during 2017. How would the deposit be reported in the financial statements at the end of 2017 ?

2. CONCEPTUAL CONNECTION Prepare the entry by Manitoba to record the delivery of 200 units during 2018. How would the deposit be reported in the financial statements at the end of 2018? Wausau pays in cash upon delivery for the excess of the selling price over the applicable deposit.
3. Prepare the entry by Manitoba to record the delivery of 300 units during 2019 .
\section*{Problem