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E18-15 Appliance Center offers the following items with respect to ovens: . Oven only 800 850 975 . Oven with installation .Oven with maintenance .
E18-15 Appliance Center offers the following items with respect to ovens: . Oven only 800 850 975 . Oven with installation .Oven with maintenance . Oven with installation &maintenance 1,000 In each instance in which maintenance services are provided, it is separately priced at $175. The incremental amount charged for installation approximates the amount charged by independent third parties. If a customer purchases an oven with installation and/or maintenance, if the customer is not satisfied, the customer is only entitled to a refund of the portion of the fee that exceeds $800. Calculate the amount of revenue to be allocated to the oven, installation, and maintenance for a customer that purchases all 3 for $1,000. Prepare the following journal entries: June 29, the customer signs the contract and makes an $800 down payment. According to the terms of the contract, this payment applies to purchasing the appliance (which the customer could leave the store with today) and a partial payment of the installation. The customer is not leaving with the oven-the store will deliver and install the oven on July 1. until the oven is installed 1. 2. July 1: the appliance arrives at the customer's residence and is installed. No cash changes hands today, but theaineance conact begins and lasts for l yeart The remaining balance is now bilable,even irt client cancels the maintenance contract. 3. July 15: the store receives a check for the remaining $200. 4. December 31: adjusting entries are prepared
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