Comprehensive Problem 9-82 (LO 9-1, LO 9-2, LO 9-3, LO 9-4) (Algo) Bryan followed in his father's footsteps and entered into the carpet business. He owns and operates I Do Carpet (IDC). Bryan prefers to install carpet only, but in order to earn additional revenue, he also cleans carpets and sells carpet-cleaning supplies. a. IDC contracted with a homebuilder in December of last year to install carpet in 10 new homes being built. The contract price of $85,000 includes $52,000 for materials (carpet). The remaining $33,000 is for IDC's service of installing the carpet. The contract also stated that all money was to be paid up front. The homebuilder paid IDC in full on December 28 of last year. The contract required IDC to complete the work by January 31 of this year, Bryan purchased the necessary carpet on January 2 and began working on the first home January 4. He completed the last home on January 27 of this year. b. IDC entered into several other contracts this year and completed the work before year-end. The work cost $150,000 in materials, and IDC elects to immediately deduct supplies. Bryan billed out $242,000 but only collected $220,000 by year-end. Of the $22,000 still owed to him, Bryan wrote off $3,500 he didn't expect to collect as a bad debt from a customer experiencing extreme financial difficulties. C. IDC entered into a three-year contract to clean the carpets of an office building. The contract specified that IDC would clean the carpets monthly from July 1 of this year through June 30 three years hence. IDC received payment in full of $9,000 ($250 a month for 36 months) on June 30 of this year. d. IDC sold 100 bottles of carpet stain remover this year for $5 per bottle (it collected $500). IDC sold 40 bottles on June 1 and 60 bottles on November 2. IDC had the following carpet-cleaning supplies on hand for this year, and IDC has elected to use the LIFO method of accounting for inventory under a perpetual Inventory system: Purchase Date November last year February this year July this year August this year Bottles 40 35 25 40 1A Total Cost $200 152 135 240 727