Ask Question
10 June, 15:54

28. David is in the business of sharpening skates for college hockey teams. He signed a contract on August 1, 2019 for $28,000 with Bentley University ("Bentley") to sharpen the team's skates for the 2019-2020 hockey season, which is played from the months of September 2019 through March 2020. The contract states that Bentley will pay David a deposit of $8,000 on August 31, 2019, $8,000 on October 31, 2019, $4,000 on December 31, 2019 and the remaining $8,000 on March 31, 2020. David performed the services as contracted throughout the hockey season. What was the amount of revenue David should recognize for year-end December 31, 2019 on the Bentley contract? A. $0 B. $16,000 C. $20,000 D. $28,000

+2
Answers (1)
  1. 10 June, 16:27
    0
    The correct answer is:

    $20,000 (C.)

    Explanation:

    To calculate the revenue recognized for the year-end on the contract, the earnings and the period will be written out clearly as follows:

    Total worth of contract = $28,000

    August 31, 2019 revenue = $8,000

    October 31, 2019 revenue = $8,000

    December 31, 2019 revenue = $4,000

    March 31, 2020 revenue = $8,000

    Therefore, revenue recognized for year-end December 31, 2019 on the Bentley contract is the total revenue received between August and December 2019, and it is calculated below as:

    8,000 + 8,000 + 4,000 = $20,000
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “28. David is in the business of sharpening skates for college hockey teams. He signed a contract on August 1, 2019 for $28,000 with Bentley ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers