Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question / 0.95/1 Cheyenne Windows manufactures and sells custom storm windows for three-season porches. Cheyenne also provides installation service for the windows. The installation process

image text in transcribed

Question / 0.95/1 Cheyenne Windows manufactures and sells custom storm windows for three-season porches. Cheyenne also provides installation service for the windows. The installation process does not involve changes in the windows, so this service can be performed by other vendors. Cheyenne enters into the following contract on July 1, 2017, with a local homeowner. The customer purchases windows for a price of $ 2,490 and chooses Cheyenne to do the installation. Cheyenne charges the same price for the windows irrespective of whether it does the installation or not. The customer pays Cheyenne $ 2,080 (which equals the standalone selling price of the windows, which have a cost of $1,110) upon delivery and the remaining balance upon installation of the windows. The windows are delivered on September 1, 2017, Cheyenne completes installation on October 15,2017, and the customer pays the balance due. Your answer is partially correct. Cheyenne estimates the standalone selling price of the installation based on an estimated cost of $400 plus a margin of 10% on cost. Prepare the journal entries for Cheyenne in 2017. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. Round answer to 0 decimal places, eg. 5,125) Date Account Titles and Explanation Debit Credit Jul. 1, 2017 No Entry No Entry To record contract entered into) Sep. 1,2017 Cash 2,080 Accounts Receivable 410 Unearned Service Reve 402 Sales Revenue 2,088 To record sales) Cost of Goods Sold 1,110 Inventory 1,110 To record cost of goods sold) Oct. 15,2017 Cash 410 Unearned Service Reven Service Revenue 402 Accounts Receivable 410 (To record payment received)

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_2

Step: 3

blur-text-image_3

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 For Managers Interpreting Accounting Information For Decision Making

Authors: Paul M. Collier

1st Edition

0470845023, 9780470845028

More Books

Students also viewed these Accounting questions