Sweet Acacia Ranch & Farm is a distributor of ranch and farm equipment. Its products include small tools, power equipment for trench-digging and fencing, grain dryers, and barn winches. Most products are sold direct via its company Internet site. However, given some of its specialty products, select farm implement stores carry Sweet Acacia's products. Pricing and cost information on three of Sweet Acacia's most popular products are as follows. Item Stand-Alone Selling Price (Cost) Mini-trencher $3,000 ($1,680) Power fence hole auger 1,008 ($672) Grain/hay dryer 12,740 ($9,240) Respond to the requirements related to the following independent revenue arrangements for Sweet Acacia Ranch & Farm. IFRS is a constraint. Sweet Acacia sells three grain/hay dryers to a local farmer at a total contract price of $41,000. In addition to the dryers, Sweet Acacia provides installation, which has a stand-alone sales value of $840 per unit installed. The contract payment also includes a $1,260 maintenance plan for the dryers for three years after installation. Sweet Acacia signs the contract on June 20, 2020, and receives a 20% down payment from the farmer. The dryers are delivered and installed on October 1, 2020, and full payment is made to Sweet Acacia. Prepare the journal entries for Sweet Acacia in 2020 related to this arrangement as well as any adjusting journal entries at its December year end. (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 0 for the amounts. Record journal entries in the order presented in the problem. Round answers to 0 decimal places, e.g. 5,275.) Date Account Titles and Explanation Debit June 20, 2020 Cash 8200 Unearned Revenue October 1, 2020 2 Cash 32800 Service Revenue (To record sales and installation revenue) October 1, 2020 IN 27720 (To record cost of goods sold) December 31, 2020 Unearned Revenue 102.5 Service Revenue On April 25, 2020, Sweet Acacia ships 100 augers to Farm Depot, a farm supply dealer in Alberta, on consignment. By June 30, 2020, Farm Depot has sold 50 of the consigned augers at the listed price of $1,008 per unit. Farm Depot notifies Sweet Acacia of the sales, retains a 10% commission, and remits the cash due to Sweet Acacia. Prepare the journal entries for Sweet Acacia and Farm Depot for the consignment arrangement. (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. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Entries for Sweet Acacia - the Consignor April 25, 2020 [ June 30, 2020 Cash [ [ (To record revenue from consignment sales) June 30, 2020 [ (To record cost of gods sold) Entries for Farm Depot - the Consignee April 25, 2020 0 [ June 30, 2020 [ (To record revenue from consignment sales) June 30, 2020 [ (To record payment on account)
