Question
Jerrys Jellies sells one- and two-year mail-order subscriptions for its jelly-of-the-month business. Subscriptions are collected in advance and credited to sales. An analysis of the
Jerry’s Jellies sells one- and two-year mail-order subscriptions for its jelly-of-the-month business. Subscriptions are collected in advance and credited to sales. An analysis of the recorded sales activity revealed the following:
| 2018 | 2019 | |||||
| Subscriptions sold | $ | 510,000 | $ | 620,000 | ||
| Scheduled deliveries: | ||||||
| 2018 | $ | 230,000 | ||||
| 2019 | 195,000 | $ | 190,000 | |||
| 2020 | 85,000 | 250,000 | ||||
| 2021 | 180,000 | |||||
| $ | 510,000 | $ | 620,000 | |||
Required:
What amount of liability for unperformed obligations should Jerry’s Jellies report on its December 31, 2019, balance sheet?
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Accounting Principles
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
9th Edition
978-0470317549, 9780470387085, 047031754X, 470387084, 978-0470533475
