Current Attempt in Progress Skysong 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 Skysong's products. Pricing and cost Information on three of Skysong's most popular products are as follows Item Mini-trencher Power fence Hole auger Grain/hay dryer Standalone Selling Price (Cost) $3,600 $2,100) 1.100 (800) 14,200 (11,200) Respond to the requirements related to the following independent revenue arrangements for Skysong Ranch & Farm On January 1, 2020, Skysong sells 30 augers to Mills Farm & Fleet for $33,000. Mills signs a 6-month note at an annual interest rate of 12%. Skysong allows Mills to return any auger that it cannot use within 60 days and receive a full refund. Based on prior experience, Skysong estimates that 5% of units sold to customers like Mills will be returned (using the most likely outcome approach). Skysong's 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 Skysong on January 1, 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit (To record sales) (To record cost of goods sold) On August 10, 2020, Skysong sells 16 minl-trenchers to a farm co-op in western Minnesota on account. Skysong provides a 4% volume discount on the mini-trenchers if the co-op has a 15% increase in purchases from Skysong 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 Skysong on August 10, 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry for the account titles and enter for the amounts) Account Titles and Explanation Debit Credit (To record sales) (To record cost of goods sold) e Textbook and Media List of Accounts Skysong sells three grain hay dryers to a local farmer at a total contract price of $46,000. In addition to the dryers, Skysong provides installation, which has a standalone selling price of $1,100 per unit installed. The contract payment also includes a $ 1.100 maintenance plan for the dryers for 3 years after installation. Skysong 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 Skysong. Prepare the journal entries for Skysong in 2020 related to this arrangement. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry for the account titles and enter for the amounts. Round answers to decimal places, es 5,275) Account Titles and Explanation Debit Credit Date Jun 20, 2020 (To record payment received) To record sales) (To record cost of goods sold) On April 25, 2020, Skysong ships 110 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 Skysong of the sales, retains a 10% commission, and remits the cash due Skysong. Prepare the journal entries for Skysong and Farm Depot for the consignment arrangement. (Credit account titles are he amount is entered. Do not indent manually. If no entry is required, select "No entry for the account titles and enter for the amounts) Account Titles and Explanation Debit Credit Date Entries for Skysong Jun 30, 2020 (To record payment received) (To record sales) Entries for Farm Depot (To record consignment sales)
