How much sales revenue should it record in the journal entry

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Reference no: EM133000033

Anvil Corp., which has an Dec 31 year-end, provides chemical treatments to various aquatic centers in the Raleigh area. In 20X1, it entered into a contract with local YMCAs to provide gallons of pool chemicals throughout the year.

The contract states the following:

  • The price charged for the first 2,000 gallons of chemicals will be $40 per gallon.
  • After 2,000 gallons, the price it charges will fall to $34 per gallon.
  • Anvil estimates 3,000 gallons will be delivered throughout 20X1.

On March 1, the first 500 gallons were delivered to the pools.

Problem 1: When Anvil delivers the first 500 gallons on March 1, how much sales revenue should it record in the journal entry?

Select one:

a. $20,000

b. $18,500

c. $19,000

Reference no: EM133000033

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