Macrobyte Limited finalised a cancellable contract with a customer. The contract: - was signed
on 1 February 203, and - required Macrobyte to supply the customer with 550000 widgets at C1
each. The customer: - took delivery (control passed at the same point in time) on 28 February
203. On this date, Macrobyte estimated that the lifetime expected credit losses were equal to
50% of the transaction price, and that the probability of default was 50%. - went into provisional
liquidation on 15 March 20X3, on which date Macrobyte received a letter confirming this fact
and stating that the customer will be able to pay a maximum of 40% of the transaction price. On
this date, Macrobyte estimated that the loss allowance relating to the receivable would be equal
to 60% of the contract price. - finally made a payment of C165000, on 5 August 203, with the
remainder of the balance due being considered to be unrecoverable. Required: Using Macrobyte
Limited's general journal, prepare all journal entries to account for the above information for the
financial year ended 30 September 203..
Macrobyte Limited finalised a cancellable contract with a customer..pdf
1. Macrobyte Limited finalised a cancellable contract with a customer. The contract: - was signed
on 1 February 203, and - required Macrobyte to supply the customer with 550000 widgets at C1
each. The customer: - took delivery (control passed at the same point in time) on 28 February
203. On this date, Macrobyte estimated that the lifetime expected credit losses were equal to
50% of the transaction price, and that the probability of default was 50%. - went into provisional
liquidation on 15 March 20X3, on which date Macrobyte received a letter confirming this fact
and stating that the customer will be able to pay a maximum of 40% of the transaction price. On
this date, Macrobyte estimated that the loss allowance relating to the receivable would be equal
to 60% of the contract price. - finally made a payment of C165000, on 5 August 203, with the
remainder of the balance due being considered to be unrecoverable. Required: Using Macrobyte
Limited's general journal, prepare all journal entries to account for the above information for the
financial year ended 30 September 203.
