A farm buys beef cattle for $66,000 at the end of 207. The cost to feed, shelter, and grow the cattle was $16,600 and 8,900 in 208 and 209, respectively. On 2 May 209, the cattle were slaughtered at a cost of $12,100. The fair value of the carcasses is $88,000. On 5 May 209, the carcasses are processed into different cuts (steak, roast) for $6,900 and sold for $145,000. Required: 1. Prepare the journal entries for 207,208, and 209 under ASPE. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 1 Record the purchase of beef cattle for $66,000 at the end of 207 under ASPE. 2 Record the $16,600 cost incurred in 208 to feed, shelter, and grow the chickens under ASPE. 3 Record the $8,900 cost incurred in 209 to feed, shelter, and grow the chickens under ASPE. 4 Record the cost to slaughter the cattle at a cost of $12,100 under ASPE. 5 Record the sale carcasses for $145,000 after they are processed into different cuts (steak, roast) for $6,900 under ASPE. Note : = journal entry has been entered 6 Record the cost of product sold. 7 Record the sale of products. No journal entry required Accounts receivable Agricultural inventories-cattle Cash/AP Contract Liability Cost of goods sold Deferred gross margin Refund Liability Revenue Right to recovery asset 2. Calculate the gross margin on the sale of the carcasses. A farm buys beef cattle for $66,000 at the end of 207. The cost to feed, shelter, and grow the cattle was $16,600 and 8,900 in 208 and 209, respectively. On 2 May 209, the cattle were slaughtered at a cost of $12,100. The fair value of the carcasses is $88,000. On 5 May 209, the carcasses are processed into different cuts (steak, roast) for $6,900 and sold for $145,000. Required: 1. Prepare the journal entries for 207,208, and 209 under ASPE. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 1 Record the purchase of beef cattle for $66,000 at the end of 207 under ASPE. 2 Record the $16,600 cost incurred in 208 to feed, shelter, and grow the chickens under ASPE. 3 Record the $8,900 cost incurred in 209 to feed, shelter, and grow the chickens under ASPE. 4 Record the cost to slaughter the cattle at a cost of $12,100 under ASPE. 5 Record the sale carcasses for $145,000 after they are processed into different cuts (steak, roast) for $6,900 under ASPE. Note : = journal entry has been entered 6 Record the cost of product sold. 7 Record the sale of products. No journal entry required Accounts receivable Agricultural inventories-cattle Cash/AP Contract Liability Cost of goods sold Deferred gross margin Refund Liability Revenue Right to recovery asset 2. Calculate the gross margin on the sale of the carcasses
