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Nat2105 [25]
2 years ago
9

Sky Communications (SKY) usually sells a cell phone for $448 plus 12 months of cellular service for $672. SKY has a special, tim

e-limited offer in which it gives the phone for free and sells the 12 months of cellular service for $560. Each phone costs SKY $280, which it accounts for in its perpetual inventory system. On July 1, SKY sells one of the special packages, delivers the phone, collects the $560 cash, and starts the cellular service.
What journal entries would SKY record on July 1 and July 31?

a. Record receipt of cash.
b. Record the sales of cellular service for 12 months.
c. Record the cost of goods sold.
d. Record the deferred revenue.
Business
1 answer:
jeka942 years ago
3 0

Explanation:

The Journal Entry from July 1 and July 31 is shown below:-

1. Cash Dr,                                             $560

            To Deferred revenue                                  $560

(Being cash is received)

2. Deferred revenue                             $336

            To Sales revenue                                         $336

(Being 12 months sales service is recorded)

3. Cost of goods sold                            $280

            To Inventory                                                 $280

(Being cost of goods sold is recorded)

4. Deferred revenue ($336 ÷ 12)            $28

            To Service revenue                                      $28

(Being Deferred service revenue is recorded)

Working Note:-

Cellular service revenue = offer price ÷ total cost of phone and service × cellular service

= (($560 ÷ ($448 + $672)) × $672

= $336

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Answer:

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total after tax cost (including investment revenue):

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= -$20,000 x 12% x 1/12 x (1 - 35%) = -$130

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c. Should Reese pay the $20,000 bill in December or January?

January, since the after tax cost is lower

d. What is the after-tax cost if she expects her marginal tax rate to be 24 percent next year and pays the $20,000 bill in January?

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e. Should Reese pay the $20,000 bill in December or January if she expects her marginal tax rate to be 32 percent this year and 24 percent next year?

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2 years ago
Competing in one or more countries or regions of the world causes strategy-making to be more complex because of
alexandr402 [8]
Here is the answer that best completes the statement:

What causes strategy-making to be more complicated as one competes in one or  more regions or countries of the world is due to existence of significant differences in each country in buyer preferences, growth potential and the sizes of the market. 
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MakcuM [25]

Answer:

The amount of total liabilities is $5,000

Explanation:

In this question, we apply the accounting equation which is shown below:

Total assets = Total liabilities + owner's equity

where,

Total assets = Cash + supplies + prepaid rent + equipment

                    = $12,000 + $4,500 + $2,000 + $65,000

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Ending retained earning balance = Beginning retained earning balance + net income - dividend paid

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