Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The accounts I have as an option on Wiley Don't include Dr. Bank or the company itself or repurchase obligation. Sage Hill Inc., a registered

image text in transcribed

The accounts I have as an option on Wiley Don't include Dr. Bank or the company itself or repurchase obligation.

Sage Hill Inc., a registered broker, enters into a finder's fee agreement with HOM Homes Ltd. on June 15, 2020. Sage Hill will find leads in the form of buyers potentially interested in purchasing HOM's real estate holdings. Along with finding potential buyers, Sage Hill helps negotiate the selling price and provides advice on contract details. If and when HOM closes a sale, Sage Hill will be paid within 30 days of the closing date, based on the following formula: 5% of any transaction value up to and including $1 million, plus 4% of any transaction value greater than $1 million and less than and including $2 million, plus 3% of any transaction value greater than $2 million and less than and including $3 million, plus 2% of any transaction value greater than $3 million and less than and including $4 million, plus 1% of any transaction value in excess of $4 million. If Sage Hill is represented by another broker and this information is not shared with HOM, the fee is reduced by 50%. On September 1, 2020, HOM paid Sage Hill $51,000 to provide some needed cash flow for seeking out buyers. On October 15, 2020, an offer was made and accepted for a parcel of real estate at a price of $3.25 million. The transaction closed on November 1, 2020, and Sage Hill was paid the finder's fee net of $51,000 on November 30, 2020. Determine the accounting treatment of the above events for Sage Hill Inc. and prepare any journal entries needed on: (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.) a. b. C. June 15, 2020 September 1, 2020 October 15, 2020 November 1, 2020 November 30, 2020 d. e

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

Step: 3

blur-text-image

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

Computer Accounting With Peachtree Complete 2011

Authors: Carol Yacht, Peachtree Software

15th Edition

007811098X, 978-0078110986

More Books

Students also viewed these Accounting questions