Question
Transaction 2 TeleCo, a customer of CoAx, entered into a binding written agreement to purchase 1,500 feet of fiber-optical cable for $3 per foot. TeleCos
Transaction 2
TeleCo, a customer of CoAx, entered into a binding written agreement to purchase 1,500 feet of fiber-optical cable for $3 per foot. TeleCos shipping terms are freight on board (FOB) shipping point. CoAx collected payment before the order was shipped. Title transfers upon delivery to the carrier, and TeleCo will insure the product while it is in transit. Instead of using a third-party shipper such as FedEx and UPS, CoAx has decided to use its own logistics subsidiary, DeliveryAx, to deliver the cable to TeleCo.
* CoAx acquired 100 percent ownership interest in DeliveryAx in the previous year. DeliveryAx provides an array of shipping services to third-party customers outside the cable industry. Only 2 percent of DeliveryAxs shipping revenue is expected to be derived from transactions with CoAx in the current year. Case 16-2c: The Cable Guys Page 2 Copyright 2015 Deloitte Development LLC All Rights Reserved.
1. Summarize transaction 2 in bullet points
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Auditing And Assurance Services
Authors: Timothy J Louwers, Robert J. Ramsay, David Sinason, Jerry R Strawser
1st Edition
0072954442, 9780072954449
