On March 15, the Spinnaker Company received $4,000 in cash from a customer who ordered a custom sail for her racing yacht. The company completed the sail and delivered it on April 30. The Spinnaker Company incurred costs of $2,500 in making the sail. Assume the company recorded the manufacturing costs in the Merchandise Inventory account.

Required

A. Record the transaction on March 15.

B. Record the transaction on April 30.

C. Prepare a table similar to Exhibit 2 that illustrates how Unearned Revenue links Cash with Sales Revenue.