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Gary Financial Services performs bookkeeping and tax - reporting services to startup companies in the Oconomowoc area. On January 1 , 2 0 2 5
Gary Financial Services performs bookkeeping and taxreporting services to startup companies in the Oconomowoc area. On January Gary entered into a year service contract with Ivanhoe Tech. Ivanhoe promises to pay $ at the beginning of each year, which at contract inception is the standalone selling price for these services. At the end of the second year, the contract is modified and the fee for the third year of services is reduced to $ In addition, Ivanhoe agrees to pay an additional $ at the beginning of the third year to cover the contract for additional years ie years remain after the modification The extended contract services are similar to those provided in the first years of the contract. Prepare the journal entries for Gary in related to the modified service contract, assuming a prospective approach. Repeat the requirements for part B assuming Gary and Ivanhoe agree on a revised set of services you were bookkeeping services, but more tax services in the extended contract. And the modification results in a separate performing obligation.
Gary Financial Services performs bookkeeping and taxreporting services to startup companies in the Oconomowoc area. On January Gary entered into a year service contract with Ivanhoe Tech. Ivanhoe promises to pay $ at the beginning of each year, which at contract inception is the standalone selling price for these services. At the end of the second year, the contract is modified and the fee for the third year of services is reduced to $ In addition, Ivanhoe agrees to pay an additional $ at the beginning of the third year to cover the contract for additional years ie years remain after the modification The extended contract services are similar to those provided in the first years of the contract.
Prepare the journal entries for Gary in related to the modified service contract, assuming a prospective approach.
Repeat the requirements for part B assuming Gary and Ivanhoe agree on a revised set of services you were bookkeeping services, but more tax services in the extended contract. And the modification results in a separate performing obligation.
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