Question
Sunland Company sells total outdoor barbecue solutions, providing gas and charcoal barbecues, accessories, and installation services for custom patio barbecue stations. Respond to the requirements
Sunland Company sells total outdoor barbecue solutions, providing gas and charcoal barbecues, accessories, and installation services for custom patio barbecue stations. Respond to the requirements related to the following independent revenue arrangements for Sunland products and services. Assume that Sunland follows IFRS. Sunland offers contract BM205, which comprises a free-standing gas barbecue for small patio use plus installation to a customers gas line for a total price of $890. On a stand-alone basis, the barbecue sells for $760 (cost $400), and Sunland estimates that the fair value of the installation service (based on cost-plus estimation) is $190. Sunland signed 14 BM205 contracts on April 20, 2020, and customers paid the contract price in cash. The barbecues were delivered and installed on May 15, 2020. Prepare journal entries for Sunland for BM205 in April and May 2020.
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