Metlock Inc. sells appliances to Seasons Department Store. A recent order requires Metlock to manufacture and deliver
Fantastic news! We've Found the answer you've been seeking!
Question:
Metlock Inc. sells appliances to Seasons Department Store. A recent order requires Metlock to manufacture and deliver 500 toasters at a price of $88 per unit. | ||||||||||||||||||||||||||
Metlock’s manufacturing costs are approximately $44 per unit. The following schedule summarizes the production and delivery record of Hydra: |
Year | 1 | 2 | 3 | Total | ||||
Toasters produced | $ 200 | $ 200 | $ 100 | $ 500 | ||||
Costs incurred | $ 8,800 | $ 8,800 | $ 4,400 | $ 22,000 | ||||
Toasters delivered | $ 150 | $ 200 | $ 150 | $ 500 | ||||
Cash received | $ 8,800 | $ 13,200 | $ 17,600 | $ 39,600 |
Fill in the blanks Required:
A) | Assuming that Metlock recognizes revenue when the toasters are produced, how much revenue should be recognized in each of the three years? | ||||||||||||||||||||||||
Assumption 1 | ANSWER HERE | Show Computations | |||||||||||||||||||||||
Revenue | |||||||||||||||||||||||||
Year 1 | $ | ||||||||||||||||||||||||
Year 2 | $ | ||||||||||||||||||||||||
Year 3 | $ | ||||||||||||||||||||||||
B) | Assuming that Metlock recognizes revenue at delivery, how much revenue should be recognized in each of the three years? | |||||||||||||||||||||||
Assumption 2 | ANSWER HERE | Show Computations | ||||||||||||||||||||||
Revenue | ||||||||||||||||||||||||
Year 1 | $ | |||||||||||||||||||||||
Year 2 | $ | |||||||||||||||||||||||
Year 3 | $ |
C) | Calculate net income for the three periods under each of the two preceding assumptions. | |||||||||||||||||||
YR 1 | Yr 2 | Yr 3 | ||||||||||||||||||
Net Income: | ||||||||||||||||||||
Assumption 1 | ANSWER HERE | |||||||||||||||||||
$ | ||||||||||||||||||||
Assump[tion 2 | ||||||||||||||||||||
$ |
Related Book For
Posted Date: