Answer:
1. 2
2. Journal Entry
3. Journal Entry
Explanation:
1. There are 2 number performance obligations in this contract.
2. Cash Dr, $95,000
To unearned sales revenue $93,100
To unearned discounted sales revenue $1,900
(Being unearned revenue is recorded)
Working Note:-
Sales revenue = 5,000 × $19.6
= $98,000
Coupon applied = $20,000 × (25% - 5%) × 50%
= $2,000
Sales revenue including discount
= $98,000 + ($20,000 × 20% × 50%)
= $100,000
Discount on sales
= $95,000 × ($2,000 ÷ $100,000)
= $1,900
3. Cash Dr, $95,000
To Unearned sales revenue $95,000
(Being unearned revenue is recorded)
