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On May 1, 2020, Richardson Inc. entered into a contract to deliver one of its specialty mowers to Kickapoo Landscaping Co. The contract requires Kickapoo to pay the contract price of $900 in advance on May 15, 2020. Kickapoo pays Richardson on May 15, 2020, and Richardson delivers the mower (with cost of $575) on May 31, 2020.

Required:
a. Prepare the journal entry on May 1, 2020, for Richardson.
b. Prepare the journal entry on May 15, 2020, for Richardson.
c. Prepare the journal entry on May 31, 2020, for Richardson.

Respuesta :

abiolataiwo2015

Answer:

A. No entry

B. Dr Cash $900

Cr Unearned sales Revenue $900

C. Dr Unearned sales Revenue $900

Dr Cost of goods sold $575

Cr Sales Revenue $900

Cr Inventory $575

Explanation:

A. Preparation of the journal entry on May 1, 2020, for Richardson.

May 1, 2020

No entry

B. Preparation of the journal entry on May 15, 2020, for Richardson.

May 15, 2020

Dr Cash $900

Cr Unearned sales Revenue $900

C Preparation of the journal entry on May 31, 2020, for Richardson.

May 31, 2020

Dr Unearned sales Revenue $900

Dr Cost of goods sold $575

Cr Sales Revenue $900

Cr Inventory $575

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