Shaw Company sells goods that cost \($300\),000 to Ricard Company for \($410\),000 on January 2, 2015. The sales price includes an installation fee, which is valued at \($40\),000. The fair value of the goods is \($370\),000. The installation is considered a separate performance obligation and is expected to take 6 months to complete.

Instructions

(a) Prepare the journal entries (if any) to record the sale on January 2, 2015.

(b) Shaw prepares an income statement for the first quarter of 2015, ending on March 31, 2015 (installation was completed on June 18, 2015). How much revenue should Shaw recognize related to its sale to Ricard?