CP3 Corp. formalized an agreement with the government on January 1, 2021. The agreement states that the government will give CP3 P40,000,000 to construct an environment-friendly factory that will produce healthy food products. The agreement requires CP3 to sell its food products below market price for 10 years, which is equivalent to the useful life of the factory. Also, it was agreed that if the government catches CP3 selling its food products above market price, the entire amount of the grant given to CP3 will be returned to the government. CP3 finished the construction of the factory on January 1, 2021 for a total cost of P60,000,000. On January 1, 2022, CP3 was caught by the government selling its food products above market price. How much is the net value of the factory if the Deduction from Asset Approach is used?
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- XZ Company, a grocery retailer operates a customer loyalty program. It grants program members loyalty points when they spend a specified amount of groceries. Program members can redeem the points for further groceries. The points have no expiry date. During the year 2020, the entity grants 100,000 points, but management expects that only 80,000 points will be redeemed. The management of XZ estimates the fair value of each loyalty point to be ₱1, and defers revenue in the amount of ₱100,000. During the year 2020, the company had redeemed 40,000 points. But during the year 2021, the management revises their expectation, it now expects to redeem 90,000 points. In 2021, the company redeemed 45,000 points. What amount of revenue from loyalty program should XZ recognize for the year ended December 31, 2021? a. ₱ 20,000 b. ₱ 25,000 c. ₱ 50,000 d. ₱ 45,000CP3 Corp. formalized an agreement with the government on January 1, 2021. The agreement states that the government will give CP3 P40,000,000 to construct an environment-friendly factory that will produce healthy food products. The agreement requires CP3 to sell its food products below market price for 10 years, which is equivalent to the useful life of the factory. Also, it was agreed that if the government catches CP3 selling its food products above market price, the entire amount of the grant given to CP3 will be returned to the government. CP3 finished the construction of the factory on January 1, 2021 for a total cost of P60,000,000. On January 1, 2022, CP3 was caught by the government selling its food products above market price. - How much is the net value of the factory if the Deduction from Asset Approach is used? - How much Loss on Repayment of the Grant will be recorded on January 1, 2022?On March 1, 2024, Gold Examiner receives $139,000 from a local bank and promises to deliver 94 units of certified 1-ounce gold bars on a future date. The contract states that ownership passes to the bank when Gold Examiner delivers the products to Brink's, a third- party carrier. In addition, Gold Examiner has agreed to provide a replacement shipment at no additional cost if the product is lost in transit. The stand-alone price of a gold bar is $1,410 per unit, and Gold Examiner estimates the stand-alone price of the replacement insurance service to be $90 per unit. Brink's picked up the gold bars from Gold Examiner on March 30, and delivery to the bank occurred on April 1. Required: 1. How many performance obligations are in this contract? 2. to 4. Prepare the journal entry Gold Examiner would record on March 1, March 30, and April 1. Complete this question by entering your answers in the tabs below. Req 1 Req 2 to 4 Prepare the journal entry Gold Examiner would record on March 1,…
- On March 1, 2024, Gold Examiner receives $148,000 from a local bank and promises to deliver 100 units of certified 1-ounce gold bars on a future date. The contract states that ownership passes to the bank when Gold Examiner delivers the products to Brink's, a third- party carrier. In addition, Gold Examiner has agreed to provide a replacement shipment at no additional cost if the product is lost in transit. The stand-alone price of a gold bar is $1,410 per unit, and Gold Examiner estimates the stand-alone price of the replacement insurance service to be $90 per unit. Brink's picked up the gold bars from Gold Examiner on March 30, and delivery to the bank occurred on April 1. Required: 1. How many performance obligations are in this contract? 2. to 4. Prepare the journal entry Gold Examiner would record on March 1, March 30, and April 1. Complete this question by entering your answers in the tabs below. Req 1 Req 2 to 4 How many performance obligations are in this contract? Number of…On June 1, 2025, Oriole Company sells $185,000 of shelving units to a local retailer, Blue Spruce, which is planning to expand its stores in the area. Under the agreement, Blue Spruce asks Oriole to retain the shelving units at its factory until the new stores are ready for installation. Title passes to Blue Spruce at the time the agreement is signed. The shelving units are delivered to the stores on September 1, 2025, and Blue Spruce pays in full. Prepare the journal entries for this bill-and-hold arrangement (assuming that conditions for recognizing the sale as a bill-and-hold sale have been met) for Oriole on June 1 and September 1, 2025. The cost of the shelving units to Oriole is $89,000. (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 O for the amounts. List all debit entries before credit entries. Record journal entries in the order presented in the…On March 1, 2024, Gold Examiner receives $157,000 from a local bank and promises to deliver 106 units of certified 1-ounce gold bars on a future date. The contract states that ownership passes to the bank when Gold Examiner delivers the products to Brink’s, a third-party carrier. In addition, Gold Examiner has agreed to provide a replacement shipment at no additional cost if the product is lost in transit. The stand-alone price of a gold bar is $1,410 per unit, and Gold Examiner estimates the stand-alone price of the replacement insurance service to be $90 per unit. Brink’s picked up the gold bars from Gold Examiner on March 30, and delivery to the bank occurred on April 1. Required: 1. How many performance obligations are in this contract? 2. to 4. Prepare the journal entry Gold Examiner would record on March 1, March 30, and April 1.
- On June 1, 2020, Bridgeport Company sells $172,000 of shelving units to a local retailer, ShopBarb, which is planning to expand its stores in the area. Under the agreement, ShopBarb asks Bridgeport to retain the shelving units at its factory until the new stores are ready for installation. Title passes to ShopBarb at the time the agreement is signed. The shelving units are delivered to the stores on September 1, 2020, and ShopBarb pays in full. Prepare the journal entries for this bill-and-hold arrangement (assuming that conditions for recognizing the sale as a bill-and-hold sale have been met) for Bridgeport on June 1 and September 1, 2020. The cost of the shelving units to Bridgeport is $88,000.Zilong Company operates a customer loyalty program. The entity grants program members loyalty points when they spend a specified amount on purchases. Program members can redeem the points for further purchases. The points have no expiry date. During 2021 the entity granted 80,000 points. Management expects that 90% of these points will be redeemed. The fair value of each loyalty point is estimated at P20. The sales during 2021 amounted to P9,000,000 including loyalty points. On December 31, 2021, 28,800 points have been redeemed in exchange for purchases. In 2022 the management revised its expectations and expects 85% of the points to be redeemed altogether. During 2022, the entity redeemed 12,000 points. What is the revenue earned from loyalty points for the year ended December 31, 2021?On March 1, 2021, Gold Examiner receives $166,000 from a local bank and promises to deliver 96 units of certified 1-oz. gold bars on a future date. The contract states that ownership passes to the bank when Gold Examiner delivers the products to Brink’s, a third-party carrier. In addition, Gold Examiner has agreed to provide a replacement shipment at no additional cost if the product is lost in transit. The stand-alone price of a gold bar is $1,680 per unit, and Gold Examiner estimates the stand-alone price of the replacement insurance service to be $70 per unit. Brink’s picked up the gold bars from Gold examiner on March 30, and delivery to the bank occurred on April 1. Required: 1.How many performance obligations are in this contract? Number of performance obligations ________________
- On March 1, 2021, Gold Examiner receives $166,000 from a local bank and promises to deliver 96 units of certified 1-oz. gold bars on a future date. The contract states that ownership passes to the bank when Gold Examiner delivers the products to Brink’s, a third-party carrier. In addition, Gold Examiner has agreed to provide a replacement shipment at no additional cost if the product is lost in transit. The stand-alone price of a gold bar is $1,680 per unit, and Gold Examiner estimates the stand-alone price of the replacement insurance service to be $70 per unit. Brink’s picked up the gold bars from Gold examiner on March 30, and delivery to the bank occurred on April 1. Required: Prepare the journal entry Gold Examiner wold record on March 1, March 30 and April 1. (Do not round intermediate calculations. If no entry is required for a transaction/event, select “ No journal entry required” in the first account field.) Record the receipt of cash by Gold Examiner. (March 01, 2021…On June 1, 2020, Mills Company sells $200,000 of shelving units to a local retailer, ShopBarb, which is planning to expand its stores in the area. Under the agreement, ShopBarb asks Mills to retain the shelving units at its factory until the new stores are ready for installation. Title passes to ShopBarb at the time the agreement is signed. The shelving units are delivered to the stores on September 1, 2020, and ShopBarb pays in full. Prepare the journal entries for this bill-and-hold arrangement (assuming that conditions for recognizing the sale as a bill-and-hold sale have been met) for Mills on June 1 and September 1, 2020. The cost of the shelving units to Mills is $110,000.An entity, a grocery retailer, operates a customer loyalty program. The entity grants program members loyalty points when they spend s specified amount on groceries. The points have no expiry date. During 2022, the sales amounted to 7,000,000.00 based on stand -alone selling price. During the year, the entity granted 10,000 points. But management expected that only 80% or 8,000 points will be redeemed. The stand alone selling price of each loyalty points is estimated at P100.On December 31, 2022, 4,800 points have been redeemed. In 2023, management revised its expectations and now expected that 90% or 9,000.00 will be redeemed altogether. During 2021, the entity redeemed 2,400 points.What amount should be reported as sales revenue including the revenue earned from points for 2022? What is the revenue earned from loyalty points for 2023?