GROUP 3 MEMBERS:

Adhityo Negoro 1806160775

Dwi Anggraeni 1806161052
Muningrum 1806161576
1 No Item Debit Credit
1 Cash $ 1,000
Deffered revenue $ 1,000
2 Deffered revenue $ 1,000
Revenue $ 1,000

2 No Date Item Debit Credit

1 1-Jan Cash $ 50
Cash $ 50
Deposit $ 100
2 24-Dec Cash $ 300
Deposit $ 50
Sale service revenue $ 350
Deposit $ 50
Revenue $ 50
3 Online Company
How much is the revenue?
= 2/100 x $300.000
= $ 6,000
When shoud the revenue be recognized?
The revenue should be recognized when Online Company receives order
and passed the order to National Grocery Chain

National Grocery Chain

How much is the revenue?
= Sales price - COGS - Commision
= $ 300.000 - $ 210.000 - $ 6.000
= $ 84,000
When should revenue be recognized?
The revenue should be recognized when groceries are delivered and cash
is received

4 a. The transaction is most likely a Consignment sales therefore the equipment is not in
sales account but in 'stock with consignee' account therefore there is no
revenue or sale hence should not be included in M's net sales for 2016
b. Paid within 20 days means 2% cash discount. Journal for the transaction :
Item Debit Credit
Cash $ 29,400
Sales revenue $ 29,400

Sales recognized from this transaction is $29,400

5 Sales = Amount of tables sold x unit price

= 300 x $ 2500
= $ 750,000
Warranty allowance = Percentage of table sold that require warranty x amount
of table sold x total warranty cost
= 10% x 300 x (110 + 130)
= $ 7,200
Warranty expense = $ 2,750

How sales, warranty allowance and warranty expense reflected on

the financial statement?
- Sales with amount of $750,000 would be in Income Statement for 2017
- Warranty expense with amount of $2700 would be in Income Statement
for 2017
- When warranty expense incurred, waranty expense account is debited and
warranty allowance account is credited.
 a.

a. Days Account Probability of Allowance for

Amount
Outstanding Uncollectible Doubtfull Account
Less than 16 $ 450,000 0.01 $ 4,500.00
16 to 30 $ 150,000 0.06 $ 9,000.00
31 to 45 $ 75,000 0.20 $ 15,000.00
46 to 60 $ 45,000 0.35 $ 15,750.00
61 to 75 $ 15,000 0.50 $ 7,500.00 b.
Over 75 $ 15,000 0.00 $ -
Balance for the Allowance for Doubtful Accounts $ 51,750.00

b. Account Receivable $ 735,000 (A/R Balance minus outstanding over 75)

Allowance for Doubtful Accounts $ 51,750 -
Account Receivable, net $ 683,250

c. After bad debt adjustment; account receivable amount after adjustment

(net A/R = $683,250) become lesser (from initial A/R = $ 735,000). This resulting on
net income amount become lesser too. Therefore net income before taxes
would be decreased.
Journal on Green Lawn's books
Item Debit Credit
Inventory on consignment $ 8,400
Merchendise inventory $ 8,400

Journal on Carson's Garden Shop

None. The goods are not belongs to Carson's Garden Shop hence its not Carson's
inventory and no journal for that.

Journal on Green Lawn's books

Item Debit Credit
Account receivable $ 5,040
Sales $ 5,040
Cost of good sold $ 3,360
Inventory on consignment $ 3,360

Journal on Carson's Garden Shop

Item Debit Credit
Cost of good sold $ 5,040
Account payable $ 5,040
Cash $ 6,720
Sales $ 6,720
 Materials Inventory
Balance, $ 100,000 $ 900,000
(1) Purchased, $ 872,000
(1) Delivery $ 22,000
$ 994,000 Material used :
= $ 100,000 + $ 872,000 + $ 22,000 - $ 94,000
Ending balance, $ 94,000

Work in Process Inventory

Balance, $ 370,000 $ 2,035,000
(3) Material used $ 900,000
(2) Direct labor $ 565,000
(4) Indirect labor $ 27,000 Cost of goods manufactured :
Factory supplies used $ 46,000 = $ 370,000 + $ 900,000 + $ 927,000 - $ 162,000
Property taxes & insurance $ 14,000
Depreciation, factory $ 54,000
Factory utilities $ 147,000
Depreciation, manufacturing $ 46,000
Selling & administrative $ 28,000
Conversion cost $ 927,000
$ 2,197,000

Ending balance, $ 162,000

Finished goods Inventory

Balance, $ 60,000 $ 2,002,000
Goods manufactured $ 2,035,000
$ 2,095,000
Cost of goods sold:
Ending balance, $ 93,000 = $ 2,095,000 - @ 95,000

Answers
a. Ending materials is $ 93,000
b. Gross margin
= Sales - Cost of goods sold
= $ 2,600,000 - $ 2,002,000
= $ 598,000