Business, 09.04.2021 03:20 sunshine0613

Allstar Inc. sells uniforms and spirit clothing to local school teams. Allen High School placed an order for 90 items for a total selling price of $3,960 on September 14, 2020. The cost of the merchandise to Allstar Inc. is $2,007. To place the order, Allstar Inc. required a $900 down payment on September 14, 2020. Delivery of the order to Allen is completed on October 7, 2020, at which time the remaining balance was collected from Allen. a. Demonstrate the five steps of the revenue recognition process for this scenario.
Description of revenue recognition step Application of the revenue recognition step
Step 1
Step 2
Step 3 Calculation of transaction price:
Step 4
Step 5
b. Record Allstar's entry on September 14, 2020.
Account Name Dr. Cr.
c. Record Allstar's entries on October 7, 2020.
Account Name Dr. Cash Cr.
Sales Revenue
To record the sale of product.
To record the cost of sale of product.

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Allstar Inc. sells uniforms and spirit clothing to local school teams. Allen High School placed an o...