Metlock Inc. sells appliances to Seasons Department Store. A recent order requires Metlock to manufacture and deliver 500 toasters at a price of $88 per unit. Metlocks manufacturing costs are approximately $44 per unit. The following schedule summarizes the production and delivery record of Hydra:

A) Assuming that Metlock recognizes revenue when the toasters are produced, how much revenue should be recognized in each of the three years?

B) Assuming that Metlock recognizes revenue at delivery, how much revenue should be recognized in each of the three years?

C) Calculate net income for the three periods under each of the two preceding assumptions. (Assumption A and B, for all 3 years)

Year		1		2		3		Total
Toasters produced		$ 200		$ 200		$ 100		$ 500
Costs incurred		$ 8,800		$ 8,800		$ 4,400		$ 22,000
Toasters delivered		$ 150		$ 200		$ 150		$ 500
Cash received		$ 8,800		$ 13,200		$ 17,600		$ 39,600