Question
On July 3 I, O'Malley Company contracted to have two products built by Taylor Manufacturing for a total of $370,000. The contract specifies that payment
On July 3 I, O'Malley Company contracted to have two products built by Taylor Manufacturing for a total of $370,000. The contract specifies that payment will only occur after both products have been transferred to O'Malley Company. Taylor determines that the standalone prices are $200,000 for Product I and $ I 70,000 for Product 2. On August I, when Product I has been transferred, Taylor's journal entry to record this event includes
a. debit to Accounts Receivable for $200,000.
b. debit to Accounts Receivable for $170,000.
c. debit to Contract Assets for $170,000.
d. debit to Contract Assets for $200,000
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Get StartedRecommended Textbook for
Advanced Financial Accounting
Authors: Thomas Beechy, Umashanker Trivedi, Kenneth MacAulay
6th edition
013703038X, 978-0137030385
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