Maxwell Textile Inc. manufactures shirts for Santa Fe LLC. Maxwell enters into a contract with...
90.2K
Verified Solution
Link Copied!
Question
Accounting
Maxwell Textile Inc. manufactures shirts for Santa Fe LLC. Maxwell enters into a contract with Santa Fe on January 1, 2021 to deliver 1,000 T-shirts at $5 each evenly until October 31, 2021. However, on October 1st 2021, they agreed on modifying the contract and Maxwell to deliver additional 100 shirts for $2 each in October 2021. (Cost per shirt is $0.5 throughout year 2021 and Maxwell uses perpetual inventory costing system.)
Please answer the following questions.
Please indicate if the modification causes a separate contract or not. Explain your
reasoning for your answer.
Please make the necessary journal entries for the "revenue to be recognized" for Maxwell in October 2021.
please help
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
- Unlimited Question Access with detailed Answers
- Zin AI - 3 Million Words
- 10 Dall-E 3 Images
- 20 Plot Generations
- Conversation with Dialogue Memory
- No Ads, Ever!
- Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.