Question: Build a Deck Inc. (BaD) enters into a contract to construct six decks adjacent to a commercial building. The purchaser has agreed to pay $5,000

Build a Deck Inc. (BaD) enters into a contract to construct six decks adjacent to a commercial building. The purchaser has agreed to pay $5,000 for each deck (total $30,000). The terms of the contract call for a 40% deposit ($2,000 per deck) at time of contract signing and payment of the balance ($3,000 per deck) as each deck is completed. The contract is signed on October 1, 2018. Two decks are completed in 2018 and the balance in 2019. BaD has a December 31 year-end. The cost to BaD of constructing each deck is $2,300, which it pays in cash.

Required:

a. Prepare summary journal entries for 2018 and 2019.

b. What is the balance in the deferred revenue account as at December 31, 2018?

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