Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On December 10,2023 , Kool-Air Solutions agreed to manufacture and supply 760 refrigerators used by Vandelay Industries. Vandelay deposited $175 per unit upon signing the

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
On December 10,2023 , Kool-Air Solutions agreed to manufacture and supply 760 refrigerators used by Vandelay Industries. Vandelay deposited $175 per unit upon signing the 3-year purchase agreement, which set the selling price of each refrigerator at $910. Kool-Air's inventory cost is $435 per unit. No units were delivered during 2023. During 2024, 170 units will be delivered; during 2025 , 320 units will be delivered; and during 2026, the remaining units will be delivered. Assume Kool-Air uses a perpetual inventory system and Vandelay pays in cash upon delivery of units for amounts not covered by the deposit. Required: 1. Conceptual Connection: Prepare the entry by Kool-Air to record receipt of the deposit during 2023. How would the deposit be reported in the financial statements at the end of 2023 ? 2. Conceptual Connection: Prepare the entry by Kool-Air to record the delivery of 170 units during 2024. How would the deposit be reported in the financial statements at the end of 2024? 3. Prepare the entry by Kool-Air to record the delivery of 320 units during 2025. 1a. Conceptual Connection: Prepare the entry by Kool-Air fo record receipt of the deposit on Decembe. 2a. Conceptual Connection: Prepare the entry by Kool-Air to record the delivery of 170 units on Decem 3. Prepare the entry by Kool-Alir to record the delivery of 320 units on December 31, 2025. reelpt of the deposit on December 10, 2023. JRNAL he delivery of 170 units on December 31,2024. JRNAL December 31, 2025. JRNAL 1b. How would the deposit be reported in the financial statements at the end of 2023 ? The portion of customer deposits pertaining to next year's deliveries should be classified as a on the balance sheet at the end of 2023; the remainder should be classified as a 2b. How would the deposit be reported in the financial statements at the end of 2024 ? The amount that pertains to next year's deliveries and would be reported as a on the balance sheet at the end of 2024 , while the remainder would be classified as a

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles Of Cost Accounting

Authors: Edward J. Vanderbeck

12th Edition

0324100949, 978-0324100945

More Books

Students also viewed these Accounting questions