identify ) the specific date revenue should be recognized and, ii) how much revenue should be...

  

Transcribed Image Text:

identify ) the specific date revenue should be recognized and, ii) how much revenue should be recognized on that date. a) On December 31, 2020, Petal agreed to sell a piece of equipment to a customer for $500,000. The equipment would be delivered on February 5th, 2021. The customer paid Petal $75,000 on December 31, 2020 and will pay the remaining $425,000 on December 31, 2022. The customer will also pay 3% of interest on the $425,000. b) A law firm, J&K, receives $12,000 from a client as a retainer. This retainer gives the client the ability to call on the law firm for services at any time over the next 12 months. Work performed by the lawyers valued at more than the retainer will be billed to the client in addition to this retainer. c) The January 25h, 2020 sale of a product for $200,000 (cost of goods valued at $150,000) to a retailer who has the right to return until April 30, 2021. The product was delivered January 25, 2020. This is a not a new product and the company has been able to accurately estimate returns at 3%. identify ) the specific date revenue should be recognized and, ii) how much revenue should be recognized on that date. a) On December 31, 2020, Petal agreed to sell a piece of equipment to a customer for $500,000. The equipment would be delivered on February 5th, 2021. The customer paid Petal $75,000 on December 31, 2020 and will pay the remaining $425,000 on December 31, 2022. The customer will also pay 3% of interest on the $425,000. b) A law firm, J&K, receives $12,000 from a client as a retainer. This retainer gives the client the ability to call on the law firm for services at any time over the next 12 months. Work performed by the lawyers valued at more than the retainer will be billed to the client in addition to this retainer. c) The January 25h, 2020 sale of a product for $200,000 (cost of goods valued at $150,000) to a retailer who has the right to return until April 30, 2021. The product was delivered January 25, 2020. This is a not a new product and the company has been able to accurately estimate returns at 3%.

Answer rating: 100% (QA)

Answer According to given conditions A 500000 should be recognized as a ... View the full answer