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On December 18, Intel receives $249,000 from a customer toward a cash sale of $2.49 million for computer chips to be completed on January 23. The computer chips had a total production cost of $1.49 million.
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On December 18, Intel receives $249,000 from a customer toward a cash sale of $2.49 million for computer chips to be completed on January 23. The computer chips had a total production cost of $1.49 million. What journal entries should Intel record on December 18 and January 23

User Quanticle
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22 votes
22 votes

Answer:

December 18

Debit cash $249,000

Credit deferred revenue $249,000

January 23rd

Debit Cash $2,241,000

Debit deferred revenue $249,000

Credit sales revenue $2,490,000

January 23rd

Debit Cost of goods sold $1.49 million

Credit Inventory $1.49 million

Step-by-step explanation:

Preparation of the journal entries that Intel should record on December 18 and January 23

December 18

Debit cash $249,000

Credit deferred revenue $249,000

January 23rd

Debit Cash $2,241,000

($2.49 million-$249,000)

Debit deferred revenue $249,000

Credit sales revenue $2,490,000

($2,241,000+$249,000)

January 23rd

Debit Cost of goods sold $1.49 million

Credit Inventory $1.49 million

User Yajiv
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