Solutions Problems Chap 18

SOLUTIONS TO UNGRADED PROBLEMS CHAPTER 18 EXERCISE 18-1 (1520 minutes) (a)Uddin could recognize tax at the engineer of sale based upon the time of cargo beca wont the books argon sold f.o.b. shipping point. Because of the retrieve policy unmatched tycoon argue in favor of the cash accrual basis. Because the returns move be estimated, one could argue for shipping point less(prenominal) estimated returns. (b)Based on the available knowledge and lack of either information indi¬cating that any of the criteria in GAAP were not met, the rectify discourse is to report revenue at the time of shipment as the gross amount less the 12% typical return factor. This is supported by the legal test of reposition of act and the criteria in GAAP. One could be very buttoned-down and use the 30% maximum return allowance. (c)Accounts receivable15,000,000 gross revenue taxationTexts15,000,000 sales Returns* ($15,000,000 X 12%)1,800,000 tolerance for sales Returns1,800, 000 (d)Sales Returns*200,000 Allowance for Sales Returns1,800,000 Accounts Receivable2,000,000 Cash13,000,000 Accounts Receivable13,000,000 *A debit to Sales RevenueTexts or Sales Returns could be made here.

? EXERCISE 18-4 (2025 minutes) (a) crude(a) pillage recognized in: 201020112012 Contract price$1,600,000$1,600,000$1,600,000 be: cost to date$400,000$825,000$1,070,000 Estimated costs to complete 600,000 1,000,000 275,000 1, coke,000 0 1,070,000 Total estimated get 600,000 500,000 530,000 Percentage completed to da te 40%* 75%*! * century% Total gross profit recognized 240,000 375,000 530,000 Less: taxation profit recognized in previous twelvemonths 0 240,000 375,000 megascopic profit recognized in current year $ 240,000 $ 135,000 $ 155,000 **$400,000 ÷ $1,000,000**$825,000 ÷...If you emergency to get a full essay, order it on our website: OrderCustomPaper.com

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