P6.2 Economy Appliance Co. manufactures low-price, no-frills appliances that are in great demand for rental units. Pricing and cost information on Economy's main products are as follows. Item Stand-Alone Selling Price (Cost) Refrigerator $500 ($260) Range $560 ($275) Stackable washer/dryer unit $700 ($400) Customers can contract a purchase either individually at the stated prices or for a three-item bundle with a price of $1,800. The bundle price includes delivery and installation. Economy provides delivery and installation as a stand-alone service for any of its products for $100. The company follows IFRS. Instructions Respond to the requirements related to the following independent revenue arrangements for Economy Appliance Co. a. On June 1, 2020, Economy sold 100 washer/dryey units without installation to Laplante Rentals for $70,000 (on credit). Laplante is a newer customer and is unsure of how this product will work in its older rental units. Economy offers a 60-day return privilege and estimates, based on prior experience with sales of this product, that 4% of the units will be returned. Prepare the journal entries for the sale and related cost of goods sold on June 1, 2020, b. YellowCard Property Managers operates upscale student apartment buildings. On May 1, 2020, Economy signs a contract with Yellow Card for 300 appliance bundles to be delivered and installed in one of its new buildings. YellowCard pays 20% cash at contract signing and will pay the balance upon delivery and installation no later than August 1, 2020. Prepare journal entries for Economy on (1) May 1, 2020, and (2) August 1, 2020, when all appliances are delivered and installed. c. Digging Deeper Refer to the arrangement in part (b). It would help YellowCard secure lease agreements with students if the delivery and installation of the appliance bundles can be completed by July 1, 2020. YellowCard offers a 10% bonus payment if Economy can complete delivery and installation by July 1, 2020. Economy estimates its chances of meeting the bonus deadline to be 60%, based on a number of prior contracts of similar scale. Repeat the requirement for part (b), given this bonus provision. Assume installation is completed by July 1, 2020