60.1K

Verified Solution

Link Copied!

Scenario #$1$: Savage Stallion $(10$ points$)$

Savage Stallion distributes high$-$quality cleaning equipment and supplies to industrial facilities and

entertainment venues worldwide.

$$ On November $12,2024,$ Savage Stallion received an order from the Cardi Waperator Dance

Emporium for an automated dance floor mopping device and ancillary equipment and supplies at a

negotiated total selling price, delivered and installed, of $$800,000,$ and received a check of $$200,000$

as $25\%$ down payment.

$$ On November $14,2024,$ Savage Stallion ordered the mopping device and the related$-$equipment and

supplies from the manufacturer at a total cost of $$225,000$ due in $30$ days from receipt.

$$ On December $3,2024,$ Savage Stallion received delivery of the equipment and supplies from the

manufacturer with an invoice in the amount of $$225,000$ due in $30$ days.

$$ On December $16,2024,$ Savage Stallion incurred $$59,700$ in costs to modify the mopping device to

the specifications of Cardi Waperator Dance Emporium.

$$ On December $19,2024,$ Savage Stallion delivered the mopping device and the related$-$equipment to

the Cardi Waperator Dance Emporium and completed the installation by incurring additional costs of

$$12,500.$

$$ On December $26,2024,$ Savage Stallion submitted an invoice to the club for the negotiated selling

price of $$800,000,$ with the balance of $$600,000$ due in $30$ days.

$$ On January $3,2025,$ Savage Stallion issued a check to the manufacturer in the amount of $$225,000$

as payment in full.

$$ On February $6,2025,$ Savage Stallion received a check from the Cardi Waperator Dance Emporium

in the amount of $$600,000$ to settle the balance due on the order.

a$)$

Identify the exact date on which Savage Stallion recorded

revenue from the sale to the Cardi Waperator Dance Emporium

according to GAAP and indicate the amount of the revenue

recorded. $(2$ points each $=4$ points$)$

Answer & Explanation Solved by verified expert

See Answer