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Coronado Ranch & Farm is a distributor of ranch and farm equipment. Its products range from small tools, power equipment for trench-digging and fencing, grain dryers, and barn winches. Most products are sold direct via its company catalog and Internet site. However, given some of its specialty products, select farm implement stores carry Coronados products. Pricing and cost information on three of Coronados most popular products are as follows.

Item		Standalone Selling Price (Cost)
Mini-trencher		$ 3,800	($2,200	)
Power fence hole auger		1,000	(800	)
Grain/hay dryer		14,800	(10,100	)

Respond to the requirements related to the following independent revenue arrangements for Coronado Ranch & Farm.

(a)

On January 1, 2020, Coronado sells 40 augers to Mills Farm & Fleet for $40,000. Mills signs a 6-month note at an annual interest rate of 12%. Coronado allows Mills to return any auger that it cannot use within 50 days and receive a full refund. Based on prior experience, Coronado estimates that 5% of units sold to customers like Mills will be returned (using the most likely outcome approach). Coronados costs to recover the products will be immaterial, and the returned augers are expected to be resold at a profit. Prepare the journal entry for Coronado on January 1, 2020. (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 0 for the amounts.)

Account Titles and Explanation	Debit	Credit
(To record sales)
(To record cost of goods sold)

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(b)

On August 10, 2020, Coronado sells 16 mini-trenchers to a farm co-op in western Minnesota on account. Coronado provides a 4% volume discount on the mini-trenchers if the co-op has a 15% increase in purchases from Coronado compared to the prior year. Given the slowdown in the farm economy, sales to the co-op have been flat, and it is highly unlikely that the benchmark will be met. Prepare the journal entry for Coronado on August 10, 2020. (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 0 for the amounts.)

Account Titles and Explanation	Debit	Credit
(To record sales)
(To record cost of goods sold)

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(c)

Coronado sells three grain/hay dryers to a local farmer at a total contract price of $47,300. In addition to the dryers, Coronado provides installation, which has a standalone selling price of $900 per unit installed. The contract payment also includes a $1,300 maintenance plan for the dryers for 3 years after installation. Coronado signs the contract on June 20, 2020, and receives a 20% down payment from the farmer. The dryers are delivered and installed on October 1, 2020, and full payment is made to Coronado. Prepare the journal entries for Coronado in 2020 related to this arrangement. (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 0 for the amounts. Round answers to 0 decimal places, e.g. 5,275.)

Date	Account Titles and Explanation	Debit	Credit
Jun. 20, 2020
Jun. 20, 2020Oct. 1, 2020Dec. 31, 2020
	(To record payment received)
	(To record sales)
	(To record cost of goods sold)
Jun. 20, 2020Oct. 1, 2020Dec. 31, 2020

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(d)

On April 25, 2020, Coronado ships 110 augers to Farm Depot, a farm supply dealer in Nebraska, on consignment. By June 30, 2020, Farm Depot has sold 50 of the consigned augers at the listed price of $1,000 per unit. Farm Depot notifies Coronado of the sales, retains a 10% commission, and remits the cash due Coronado. Prepare the journal entries for Coronado and Farm Depot for the consignment arrangement. (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 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
Entries for Coronado
Apr. 25, 2020Jun. 30, 2020
Jun. 30, 2020
	(To record payment received)
	(To record cost of sales)
Entries for Farm Depot
Apr. 25, 2020Jun. 30, 2020
Apr. 25, 2020Jun. 30, 2020
	(To record consignment sales)
Apr. 25, 2020Jun. 30, 2020
	(To record payment)

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