Consider the following transactions which are independent except as noted;Revenue Recognition;Consider the following transactions, which are independent, except as noted: 1. Sarah Jones, R.N., provided home nursing services to her clients and billed them for 20 hours of service at $65 per hour.;2. Ms. Jones collected $60 per hour from her state?s Medicaid program for the services in transaction 1. Patients are not required to make up any shortfall for the 20 hours of service. Therefore, Sarah wrote off (canceled) the balance in the receivable account.;3. Quick-Shop Grocery sold food and other merchandise for $3,500, on account.;(Ignore the cost of goods sold.);4. Quick-Shop Grocery contracted with Bob?s Bakery to provide flour, sugar, and other ingredients at a standard fee of $100 per day.;5. Andy?s Aerobic Aerie sold annual memberships to exercise fanatics at $30 per month. This entitles members to unlimited access to aerobics classes, workouts, and so on. On January 1, Andy signed 100 members, who pay the first month?s fee.;6. Andy signed an agreement with Sarah Jones to provide discounted memberships to 10 of her impoverished clients at $20 per month. Half paid at the end of the first month.;7. Andy decided to prepare and distribute a monthly aerobics magazine, which is available to members at $5 per issue. Only half of Andy?s 110 members took advantage of this offer and paid the annual subscription.;8. Andy put 30 copies of the aerobics magazine on display in Quick-Shop. These copies were ?consigned? to Quick-Shop, and payment is not due until the issues are sold.;9. All 30 copies of the guide sold. Andy collected $4 per issue from Quick-Shop ($5 minus 20% consignment fee).;Required;a. Determine the revenue associated with each item that would be recognized during the first month under the accrual method.;b. Determine the revenue that would be recognized for each item under the cash basis of accounting.;View less ?
Paper#29231 | Written in 18-Jul-2015Price : $37