rill Master offers contract GM205, which is comprised of a free-standing gas gri
ID: 2461570 • Letter: R
Question
rill Master offers contract GM205, which is comprised of a free-standing gas grill for small patio use plus installation to a customer’s gas line for a total price $770. On a standalone basis, the grill sells for $650 (cost $470), and Grill Master estimates that the fair value of the installation service (based on cost-plus estimation) is $155. Grill Master signed 16 GM205 contracts on April 20, 2014, and customers paid the contract price in cash. The grills were delivered and installed on May 15, 2014.
Prepare journal entries for Grill Master for GM205 in April and May 2014. (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
Apr. 20, 2014
May 15, 2014
(To record revenue)
May 15, 2014
(To record cost of goods sold)
Date
Account Titles and Explanation
Debit
Credit
Apr. 20, 2014
May 15, 2014
(To record revenue)
May 15, 2014
(To record cost of goods sold)
Explanation / Answer
Date Account Titles and Explanation Debit Credit Apr. 20, 2014 Cash A/c 12320 Unearned Revenue A/c 12320 May 15, 2014 Unearned Revenue A/c 12320 Sales A/c 12320 (To record revenue) May 15, 2014 Sales A/c 10000 Cost of Goods Sold A/c 10000 (To record cost of goods sold)
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