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Sandhill Corp. designs and builds custom harvesting equipment for logging companies across Canada. The company, which is publicly traded, has a May 3 1 year
Sandhill Corp. designs and builds custom harvesting equipment for logging companies across Canada. The company, which is publicly
traded, has a May year end. On February Sandhill signed a contract with Tamarisk Harvesting Ltd to design and build
custom harvesters that can harvest wood at the steep grades found along many of the Pacific Coast timber stands included in
Tamarisk's harvesting leases. The following events took place in in relation to the contract:
February : Officials from Sandhill and Tamarisk sign the contract. The contract was for $ million. Sandhill is to design,
manufacture, and deliver the machines to Tamarisk's operations centre in Duncan, British Columbia. Sandhill's
management estimates that the design component of the contract would be valued at $ if contracted for separately,
while the machine construction component of the contract would be valued at $ million if the machines were purchased
separately. Sandhill agrees to provide a threeyear assurancetype warranty for the machines, and the company's
management estimates that the warranty claims would total $ based on past experience. Tamarisk agrees to pay a
$ deposit within days of signing the contract and to pay the balance within days of the equipment being
delivered.
February : Tamarisk pays the deposit specified in the contract.
March : Sandhill's engineering staff complete the equipment design and it is approved by officials from Tamarisk.
May : Sandhill completes construction of the harvesters.
May : The harvesters are loaded onto Sandhill's trucks and are delivered to Tamarisk's operation centre in Duncan later
that day.
June : Tamarisk pays the balance owing on the contract.
a
Determine when and how much revenue Sandhill would be able to recognize for the year ended May Round allocation
percentage to decimal places, eg and final answers to decimal places, eg
Revenue recognized on
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