Blue Ranch & Farm 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 Blues products. Pricing and cost information on three of Blues most popular products are as follows:

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Respond to the requirements related to the following independent revenue arrangements for Blue Ranch & Farm.

1. On January 1, 2020, Blue sells 30 augers to Mills Farm & Fleet for $33,000. Mills signs a 6-month note at an annual interest rate of 12%. Blue allows Mills to return any auger that it cannot use within 60 days and receive a full refund. Based on prior experience, Blue estimates that 5% of units sold to customers like Mills will be returned (using the most likely outcome approach). Blues 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 Blue on January 1, 2020

2. On August 10, 2020, Blue sells 17 mini-trenchers to a farm co-op in western Minnesota on account. Blue provides a 4% volume discount on the mini-trenchers if the co-op has a 15% increase in purchases from Blue 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 Blue on August 10, 2020.

3. Blue sells three grain/hay dryers to a local farmer at a total contract price of $42,900. In addition to the dryers, Blue provides installation, which has a standalone selling price of $1,000 per unit installed. The contract payment also includes a $1,400 maintenance plan for the dryers for 3 years after installation. Blue signs the contract on June 20, 2020, and receives a 20% down payment from the farmer. The dryers are delivered and installed on October 1, 2020, and full payment is made to Blue. Prepare the journal entries for Blue in 2020 related to this arrangement.

4. On April 25, 2020, Blue ships 100 augers to Farm Depot, a farm supply dealer in Nebraska, on consignment. By June 30, 2020, Farm Depot has sold 60 of the consigned augers at the listed price of $1,100 per unit. Farm Depot notifies Blue of the sales, retains a 10% commission, and remits the cash due Blue. Prepare the journal entries for Blue and Farm Depot for the consignment arrangement.

Item Mini-trencher Power fence hole auger Grain/hay dryer Standalone Selling Price (Cost) $3,300 $2,000) 1,100 (900) 13,200 (10,000) Item Mini-trencher Power fence hole auger Grain/hay dryer Standalone Selling Price (Cost) $3,300 $2,000) 1,100 (900) 13,200 (10,000)