Part Two: Problem

Ocean Pool Company sells prefabricated pools. On March 1, 2020, Ocean Pool Company enters into a non-cancelable contract with International Hotel to sell a prefabricated pool for $138,000. The sales price includes installation and a monthly maintenance for the first year. The prefabricated pool cost $80,000 and has a standalone selling price of $120,000. The installation service is valued at $24,000 and is expected to take 3 months to complete. The maintenance service is usually sold at $6,000 per year ($500.00 per month). Ocean Pool Company sells the pool, the installation and the maintenance service separately. The installation and maintenance services could be performed by other entities. The contract requires International Hotel to pay $100,000 when the prefabricated pool is delivered and the balance must be paid when the installation is completed. The prefabricated pool was delivered on April 15, 2020 and the installation was completed on July 15, 2020. The maintenance service started on August 1, 2020. International Hotel made the payments according to the contract.

Required:

3. Prepare all the journal entries that Ocean Pool Company should make during 2020 to account for this contract. Specify the date of each journal entry.

Date	Accounts Title and Explanation	Ref.	Debit	Credit