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ACC - Journal Entries Problem




Question;Show all journal entries required to reflect this sale:a. Software bundle sold at the end of the 20XO with a 10 percent discount plus free installation and three years of additional free software maintenance and support (in this exercise, in order to meet sales quotas, free services are added to the contract)b. Contract signed and the customer accepts the software and it is installed on 12/29/XO.List Price of the Bundle $ 20,000,000Less: Discount (2,000,000)Total sales price $ 18,000,000Bundle Contents:a. Software Package - Never offered without one-year support, one-year maintenance, and installation and formal customer acceptance.b. Software Support for one year - First year of support is always included, never sold separately.c. Annual renewal of software support is offered at a list price of $2,000,000. No one can remember this ever being discounted.d. Software Maintenance - First year always included in pricing never sold separately. Renewal of full maintenance support is at a list price of $2,000,000.Special Payment Terms:12/31/XO: 30 percent upfront at time of delivery and installation3/31/X1: 40 percent at end of first quarter12/31/X1: 30 percent at the end of the 2nd year


Paper#39907 | Written in 18-Jul-2015

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