Problems 45 & 46

is less than the origina eg Contract gives the right to the seller to repurchase meia price is less than the original selling price. Contract gives the right to the seller to repurchase merchandise sold to a customer where price is equal to the original selling price. Contract gives the right to the customer to obligate the seller to repurchase merchandise where the repurchase price is less than the expected market value. the repurchase d. sold to a customer Contract gives the right to the customer to obligate the seller to repurchase merchandise sold t here the repurchase price is greater than the expected market value and greater than the original tomer w selling price. Travel-by-Air Inc. sells discounted airline tickets to travelers on three major airlines. The discounted airfares Brief Exercise 7-45 are established by the airline companies that fulfill the promised flights. After purchase, customers must contact Recording Principal the airline companies directly for changes to or questions about their airline tickets. The customer pays for the airline ticket through the website of Travel-by-Air. Travel-by-Air forwards the payment for the airline tickets to the airlines less a 10% commission fee. In August of 2020, Travel-by-Air collected cash from customers totaling S40,000, and forwarded $36,000 (fees collected less commission) to the airlines. Prepare the entry recorded by Travel-by-Air Inc. to (a) recognize revenue, and (b) remit payment to the airlines. and Agent Revenue Entries LO8 Indicate how each of the following items would be included in the financial statements of a company: (I) expense Brief Exercise 7-46 on the income statement, (2) asset on the balance sheet and systematically expensed, (3) liability on the balance sheet, or (4) current asset on the balance sheet. a. Costs to obtain a three-year contract that are expected to be recovered over the contract term. b. Reporting of Contract Revenues and Costs in Financial Direct costs to fulfill a three-year contract's performance obligations that are expected to be recovered recovered Statements L over the contract term. c. Receipt of a down payment on a contract expected to be satisfied in two months d. Unconditional right to consideration. e. Seller's right to recover a product from a customer to settle an anticipated future return For the following items 1 to 6, indicate whether the item would be (a) expensed as asset, or (c) may be either expensed as incurred or capitalized as an asset. Brief Exercise 7-47 capitalized as an idenilying the l. Sales commission costs to obtain a two-year revenue contract that are r venues and Costs in Financial LO8