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Exercise 18-12

Nash Company sells goods that cost $308,000to Ricard Company for $427,000on January 2, 2017. The sales price includes an installation fee, which has a standalone selling price of $39,000. The standalone selling price of the goods is $388,000. The installation is considered a separate performance obligation and is expected to take 6 months to complete.

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Exercise 18-7 (Part Level Submission) Whispering Biotech enters into a licensing agreement with Pang Pharmaceutical for a drug under development. Whispering will receive a payment of $10,100,000 if the drug receives regulatory approval. Based on prior experience in the drug-approval process, Whispering determines it is 80% likely that the drug will gain approval and a 20% chance of denial. Exercise 18-12 Nash Company sells goods that cost $308,000 to Ricard Company for $427,000 on January 2, 2017. The sales price includes an installation fee, which has a standalone selling price of $39,000. The standalone selling price of the goods is $388,000. The installation is considered a separate performance obligation and is expected to take 6 months to complete. (a) Prepare the journal entry (if any) to record the sale on January 2, 2017. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.) (b) Nash prepares an income statement for the first quarter of 2017, ending on March 31, 2017 (installation was completed on June 18, 2017). How much revenue should Nash recognize related to its sale to Ricard

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