Marigold Ranch & Farm is a distributor of ranch and farm equipment. Its products range from small tools, power equipment for trench- digging and fencing, grain dryers, and barn winches. Most products are sold direct via its company catalog and Internet site. However, given some of its specialty products, select farm implement stores carry Marigold's products. Pricing and cost information on three of Marigold's most popular products are as follows. Item Standalone Selling Price (Cost) Mini-trencher $3,700 ($2,100 ) Power fence hole auger Grain/hay dryer 1,300 (700 ) 13,000 (11,800 ) Respond to the requirements related to the following independent revenue arrangements for Marigold Ranch & Farm. (a) On January 1, 2020, Marigold sells 50 augers to Mills Farm & Fleet for $65,000. Mills signs a 6-month note at an annual interest rate of 12%. Marigold allows Mills to return any auger that it cannot use within 50 days and receive a full refund. Based on prior experience, Marigold estimates that 5% of units sold to customers like Mills will be returned (using the most likely outcome approach). Marigold's costs to recover the products will be immaterial, and the returned augers are expected to be resold at a profit. Prepare the journal entry for Marigold on January 1, 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 O for the amounts.) Account Titles and Explanation (To record sales) (To record cost of goods sold) Debit Credit (b) On August 10, 2020, Marigold sells 15 mini-trenchers to a farm co-op in western Minnesota on account. Marigold provides a 4% volume discount on the mini-trenchers if the co-op has a 15% increase in purchases from Marigold compared to the prior year. Given the slowdown in the farm economy, sales to the co-op have been flat, and it is highly unlikely that the benchmark will be met. Prepare the journal entry for Marigold on August 10, 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 O for the amounts.) Account Titles and Explanation (To record sales) (To record cost of goods sold) eTextbook and Media List of Accounts Save for Later Debit Credit Attempts: 0 of 5 used Submit Answer (c) Marigold sells three grain/hay dryers to a local farmer at a total contract price of $42,000. In addition to the dryers, Marigold provides installation, which has a standalone selling price of $900 per unit installed. The contract payment also includes a $1,400 maintenance plan for the dryers for 3 years after installation. Marigold signs the contract on June 20, 2020, and receives a 20% down payment from the farmer. The dryers are delivered and installed on October 1, 2020, and full payment is made to Marigold. Prepare the journal entries for Marigold in 2020 related to this arrangement. (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. Round answers to O decimal places, e.g. 5,275.) Date Account Titles and Explanation Jun. 20, 2020 (To record payment received) (To record sales) (To record cost of goods sold) Debit Credil (d) On April 25, 2020, Marigold ships 90 augers to Farm Depot, a farm supply dealer in Nebraska, on consignment. By June 30, 2020, Farm Depot has sold 50 of the consigned augers at the listed price of $1,300 per unit. Farm Depot notifies Marigold of the sales, retains a 10% commission, and remits the cash due Marigold. Prepare the journal entries for Marigold and Farm Depot for the consignment arrangement. (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 Entries for Marigold Account Titles and Explanation Debit Credit Jun. 30, 2020 (To record payment received) Entries for Farm (To record cost of sales) Depot (To record consignment sales) (To record payment)