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Sheridan Co. enters into a contact to sell Product A and Product B on January 2, 2020, for an upfront cash payment of $180,000. Product A will be delivered in two years (January 2, 2022) and Product B will be delivered in five years (January 2, 2025). Sheridan Co. allocates the $180,000 to Products A and B on a relative stand-alone selling price basis as follows. Stand-Alone Selling Prices $47,500 142,500 Percent Allocated 25% Product A Product B Allocated Amounts $45,000 135,000 $180,000 75% $190,000 Sheridan Co. uses an interest rate of 6%, which is its incremental borrowing rate. Prepare the journal entries necessary on January 2, 2020, and December 31, 2020. (Credit account titles are automatically indented when the 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. Record journal entries in the order presented in the problem.) a Account Titles and Explanation Debit Credit 20 Cash 180000 Unearned Revenue 180000 L, 2020 Interest Expense 10800 Interest Payable 10800 Prepare the journal entry needed on December 31, 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit Date December 31, 2021 Interest Expense 11448 Interest Payable 11448 e Textbook and Media List of Accounts Prepare the journal entry needed on January 2, 2022. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter Ofor the amounts.) Date Account Titles and Explanation Debit Credit January 2, 2022 Unearned Revenue 45000 Sales Revenue 45000 e Textbook and Media List of Accounts Using Excel or a financial calculator, calculate the amount of revenue to be recognized for Product B. (Round answer to 2 decimal places, e.g. 5,275.25.) Amount of revenue to be recognized $ Prepare the journal entry needed on January 2, 2025. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Round answers to 0 decimal places, e.g. 5,275.) Date Account Titles and Explanation Debit Credit January 2, 2025 Unearned Revenue 162000 Sales Revenue 162000

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