Exercise 6-14 Wildhorse Co. enters into a contact to sell Product A and Product B on January 2, 2020, for an upfront cash payment of $240,000. Product A will be delivered in two years (January 2, 2022) and Product B will be delivered in five years (January 2, 2025). Wildhorse Co. allocates the $240,000 to Products A and B on a relative stand-alone selling price basis as follows. Percent Allocated Product A Product B Stand-Alone Selling Prices $50,000 200,000 $250,000 20% 80% Allocated Amounts $48,000 192,000 $240,000 Wildhorse Co. uses an interest rate of 5%, which is its incremental borrowing rate. Prepare the journal entries necessary on January 2, 2020, and December 31, 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 0 for the amounts. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit SHOW LIST OF ACCOUNTS LINK TO TEXT Prepare the journal entry needed on December 31, 2021. (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.) Date Account Titles and Explanation Debit Credit December 31, 2021 PRINTER VERSION A BACK NEXT Prepare the journal entry needed on December 31, 2021. (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 0 for the amounts.) Date Account Titles and Explanation Debit Credit December 31, 2021 SHOW LIST OF ACCOUNTS LINK TO TEXT Prepare the journal entry needed on January 2, 2022. (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.) Date Account Titles and Explanation Debit Credit January 2, 2022 SHOW LIST OF ACCOUNTS LINK TO TEXT Using Excel or a financial calculator, calculate the amount of revenue to be recognized for Product B. (Round answer to 2 decimal places, e.g. 5,275.25.) Amount of revenue to be recognized Prepare the journal entry needed on January 2, 2025. (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 0 for the amounts. Round answers to 0 decimal places, e.g. 5,275.) Date Account Titles and Explanation Debit Credit January 2, 2025 SHOW LIST OF ACCOUNTS LINK TO TEXT Question Attempts: 0 of 3 used SAVE FOR LATER SUBMIT ANSWER Exercise 6-14 Wildhorse Co. enters into a contact to sell Product A and Product B on January 2, 2020, for an upfront cash payment of $240,000. Product A will be delivered in two years (January 2, 2022) and Product B will be delivered in five years (January 2, 2025). Wildhorse Co. allocates the $240,000 to Products A and B on a relative stand-alone selling price basis as follows. Percent Allocated Product A Product B Stand-Alone Selling Prices $50,000 200,000 $250,000 20% 80% Allocated Amounts $48,000 192,000 $240,000 Wildhorse Co. uses an interest rate of 5%, which is its incremental borrowing rate. Prepare the journal entries necessary on January 2, 2020, and December 31, 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 0 for the amounts. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit SHOW LIST OF ACCOUNTS LINK TO TEXT Prepare the journal entry needed on December 31, 2021. (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.) Date Account Titles and Explanation Debit Credit December 31, 2021 PRINTER VERSION A BACK NEXT Prepare the journal entry needed on December 31, 2021. (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 0 for the amounts.) Date Account Titles and Explanation Debit Credit December 31, 2021 SHOW LIST OF ACCOUNTS LINK TO TEXT Prepare the journal entry needed on January 2, 2022. (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.) Date Account Titles and Explanation Debit Credit January 2, 2022 SHOW LIST OF ACCOUNTS LINK TO TEXT Using Excel or a financial calculator, calculate the amount of revenue to be recognized for Product B. (Round answer to 2 decimal places, e.g. 5,275.25.) Amount of revenue to be recognized Prepare the journal entry needed on January 2, 2025. (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 0 for the amounts. Round answers to 0 decimal places, e.g. 5,275.) Date Account Titles and Explanation Debit Credit January 2, 2025 SHOW LIST OF ACCOUNTS LINK TO TEXT Question Attempts: 0 of 3 used