Safeathome Ltd. (SAH) is a privately owned company that sells packages of home alarm and...
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Accounting
Safeathome Ltd. (SAH) is a privately owned company that sells packages of home alarm and monitoring systems. SAH sells a package for $1,250 that includes an alarm system with installation and monitoring service for one year. Sold separately, the price of the alarm system with installation is $775, and the price of one years worth of monitoring is $850. SAH Ltd. sold 45 packages on June 1, 2020. The original cost of each alarm system is $550. SAH reports under IFRS and has a December 31 year end. The monitoring service is provided evenly over the one-year period. Required:
Prepare the journal entries relating to this transaction at June 1, 2020, and for SAHs year ended December 31, 2020. (Assume that the journal entries to expense any costs of providing the monitoring service have already been prepared.)
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