Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Posted one sinilar to this and the numbers didnt show in the solution. Please show numbers so I dont have to post twice. Exercise 6-11

image text in transcribed
image text in transcribed
Posted one sinilar to this and the numbers didnt show in the solution. Please show numbers so I dont have to post twice.
Exercise 6-11 (Algo) Variable consideration - expected value; change in estimate (LO6-3, 6-6) Rocky Guide Service provides guided 1-5 day hiking tours throughout the Rocky Mountains. Wilderness Tours hires Rocky to lead various tours that Wilderness sells. Rocky receives $2,300 per tour day, and shortly after the end of each month Rocky learns whether it will receive a $230 bonus per tour day it guided during the previous month if its service during that month received an average evaluation of excellent by Wilderness customers. The $2,300 per day and any bonus due are paid in one lump payment shortly after the end of each month. . On July based on prior experience, Rocky estimated there is a 20% chance it will earn the bonus for July tours It guided a total of 10 days from July 1-July 15 On July 16, based on Rocky's view that it had provided excellent service during the first part of the month Rocky revised its estimate to an 70% chance it would eam the bonus for July tours Rocky also guided customers for 15 days from July 16- July 31 . On August 5 Rocky learned it did not receive an average evaluation of excellent for its July tours, so it would not receive any bonus for July, and received all payment due for the July tours Rocky bases estimates of vanable consideration on the expected value t expects to receive Required: 1. to 3. Prepare the journal entries to record the transactions above (if no entry is required for a transaction/event, select "No journal entry required in the first account field.) 1. to 3. Prepare the journal entries to record the transactions above (If no entry is required for a transaction/event, sele journal entry required" in the first account field.) Answer is not complete. No Date General Journal Debit Credit 1 July 15 Accounts receivable 23,000 2 July 31 Accounts receivable Bonus receivable OOO Service revenue 3 August 05 Cash Accounts receivable 4 August 05 Service revenue Bonus recevable B.COM 4 of 10 Next >

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

Accounting Principles

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

9th Edition

978-0470317549, 9780470387085, 047031754X, 470387084, 978-0470533475

More Books

Students also viewed these Accounting questions