Entity A is operated as an internet cafe locates at Sham Shui Po of Kowloon. It is open 24/7 (24 hours a day and 7 days a week) every day. Recently, it entered into a short-term contract with Entity B which is an electronic game server-workstation service provider on 1 January 2022 for providing network game solutions. The contract period was 6 months from 1 February 2022 to 31 July 2022. On 31 January 2022, Entity B delivered one game server with ten game workstations to Entity A. The terms of the contract include the provision of one game server with ten game workstations, a 24/7 technical suporting service and a 9/7 training service to Entity A over the contract period. Entity A is not required to return the game server and the workstations back to Entity B at the contract end. Entity A is required to pay a monthly fixed fee of $86,000 to Entity B at every month-end. Entity B sells the same set of game server and workstations to other customers for $540,000. The original cost of them is $312,000. Entity B also provides the same 24/7 technical suporting service and 9/7 training service to other customers alone for $4,000 and $6,000 per month respectively. The end of the reporting period is 31 December.

REQUIRED:

According to relevant accounting standards, prepare journal entries to recognise the transactions of Entity B from 1 January 2022 to 28 February 2022, 1 May 2022, 31 May 2022, 1 July 2022 and 31 July 2022.

ACCOUNTS FOR INPUT:

| Revenue (Server-workstations) | Cost of sales (Server-workstations) | Inventory (Server-workstations) |

| Revenue (Technical suport) | Cost of sales (Technical suport) | Inventory (Technical suport) |

| Revenue (Training) | Cost of sales (Training) | Inventory (Training) |

| Contract asset (Server-workstations) | Contract liability (Server-workstations) |

| Contract asset (Technical suport) | Contract liability (Technical suport) |

| Contract asset (Training) | Contract liability (Training) |

| Payable | Receivable | Bank | Interest expense | Interest revenue | No entry |

| Retained earnings | Share capital |

ANSWERS:

Journal Entries:

need to use the accounts provided upside

Date	Account Name	Debit ($)	Credit ($)	Hints For Sequence
1-Jan-22				-
				-
31-Jan-22				-
				-
				-
				-
1-Feb-22				-
				-
				Related to Technical Suport
				Related to Training
28-Feb-22				-
				-
28-Feb-22				Related to Technical Suport
				-
28-Feb-22				Related to Training
				-
1-May-22				-
				-
				Related to Technical Suport
				Related to Training
31-May-22				-
				-
31-May-22				Related to Technical Suport
				-
31-May-22				Related to Training
				-
1-Jul-22				-
				-
				Related to Technical Suport
				Related to Training
31-Jul-22				-
				-
31-Jul-22				Related to Technical Suport
				-
31-Jul-22				Related to Training
				-