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25 April, 15:59

On July 1, 2014, Ellsbury Inc. entered into a contract to deliver one of its specialty machines to Kickapoo Landscaping Co. The contract requires Kickapoo to pay the contract price of $2,500 in advance on July 15, 2014. Kickapoo pays Ellsbury on July 15, 2014, and Ellsbury delivers the machine (with cost of $1,600) on July 31, 2014. Instructionsa. Prepare the journal entry on July 1, 2014, for Ellsbury. b. Prepare the journal entry on July 15, 2014, for Ellsbury. c. Prepare the journal entry on July 31, 2014, for Ellsbury.

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  1. 25 April, 16:16
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    (a)

    No Entry needed for Ellsbury on July 1 2014

    (b)

    Journal entry for Ellsbury as at July 15, 2014

    Dr Cash 2500

    Cr Unearned Revenue 2500

    (c)

    Journal entry for Ellsbury as at July 31, 2014

    Dr Unearned Revenue 2500

    Cr Sales Revenue 2500

    Dr Cost of goods sold 1600

    Cr Inventory 1600
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