Question
In: Accounting
On April 1, 2018, JS Co. sold equipment to JL Co. Service in exchange for a...
On April 1, 2018, JS Co. sold equipment to JL Co. Service in exchange for a zero-interest bearing note with a face value of €109,000, with payment due in 12 months. The cost of goods sold is € 58,000. The fair value of the equipment on the date of sale was €100,000.
A- Record the entry showing how much revenue should JS Co. record on April 1, 2018.
B- Record the entry showing how much revenue should it report related to this transaction on December 31, 2018
Solutions
Expert Solution
Required A
| Particulars | Debit | Credit |
| Notes Receivable | $ 109,000 | |
| Sales Revenue | $ 100,000 | |
| Unearned Revenue | $ 9,000 |
Thus JS Co. should record a revenue of $100,000 on April 1, 2018.
Required B
| Particulars | Debit | Credit |
| Unearned Revenue | $ 6,750 | |
| Interest income | $ 6,750 |
Thus JS Co. should record a revenue of $6750 on December 31, 2018.
ekkarill92 answered 1 year agoRelated Solutions
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