1. On January 1, 2023, Spring Fashions, Inc. enters into a contract with southeast retail company to provide 500 dresses for $62,500 ($125 per dress) over the next 10 months. On October 1, 2023, after 450 of the dresses had been delivered (50 dresses per month), the contract is modified.

a. Fifty dresses were delivered each month for the first 9 months of Year 1. Prepare Spring Fashions monthly journal entry to record revenue. As each month 50 dresses are delivered the same entry is made each month so you only need to show me the entry once.

Months	Account name	DEBIT	CREDIT
Jan, Feb, March, April, May, June, July, Aug. Sept, Oct

b. Assume that the contract is modified to sell, once the original 500 dresses are delivered, an additional 100 dresses at $110 per dress, which is the stand-alone selling price on October 1, 2023. Assume the dresses are delivered evenly in November and December of 2023. Prepare the journal entries to record the contract modification.

Months	Account name	DEBIT	CREDIT
November 1, 2023
December 1, 2023

2. On January 1, 2023, ForeRunner, Inc. enters into a contract with a sporting goods company to provide 100 GPS enabled watches for $25,000 ($250 per watch) over the next 6 months. Assume 30, 20, and 30 watches were delivered in January, February, and March, respectively.

a. Assume 30, 20, and 30 watches were delivered in January, February, and March, respectively. Prepare ForeRunners journal entries to record revenue for each of these months.

	Account name	DEBIT	CREDIT
January
February
March

b. On April 1, 2023, after 80 of the watches have been delivered, the contract is modified.Assume the contract is modified to include an additional 40 watches at $205 per watch which does not represent the stand-alone selling price on April 1, 2023. Assume that 20 watches are sold to the sporting goods company in April, May, and June. Prepare the journal entries to record the watch sales in April, May, and June.

	Account name	DEBIT	CREDIT
April
May
June

c. Assume that the contract is modified to reduce the price of the remaining 20 watches from the original order of 100 watches to $205 per watch, which is significantly lower than the stand-alone selling price on April 1, 2023. Assume 10, 5 and 5 watches are sold in April, May, and June, respectively. Prepare the Journal entries to record the watch sales in April, May and June.

	Account name	DEBIT	CREDIT
April
May
June