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Required information [The following information applies to the questions displayed below.] Great American Oilchange (GAO) sells a combined oil change service and parts package for
Required information [The following information applies to the questions displayed below.] Great American Oilchange (GAO) sells a combined oil change service and parts package for $50. A customer who supplies the parts (oil and filter) is charged $40 for only the service, whereas a customer who buys only the oil and filter (for do-it-yourself use) is charged $40 for the parts. The parts cost GAO $34. Required: 1. Determine the dollar amount of revenue from the oil change service versus the sale of parts for each combined oil change package. TIP: To calculate the percentage of the combined package that relates to the service, divide the stand-alone selling price of the service by the combined stand-alone selling prices of both the service and parts. 2. Prepare the journal entry GAO would record if GAO provides a combined oil change service and parts package to a customer on October 7. Assume GAO distinguishes Service Revenue from Sales Revenue arising from the sale of parts, it uses a perpetual inventory system for recording the cost of goods sold, and it collects cash the day the oil change is performed. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) Journal entry worksheet Note: Enter debits before credits. Journal entry worksheet Note: Enter debits before credits
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