On January 1, 2013, Color Company agreed to sell a diamond to a customer at a special price of $4,000. In return, the customer signed a non-interest bearing note payable to Color Company. Payment terms were $800 on January 1, 2013, and $800 each January 1 from 2014 to 2017. Color normally charges 8% interest to its customers.
What amount of revenue and accounts receivable should Color recognize on January 1, 2013?

Question

Quizplus · Accepted Answer

The Answer of On January 1, 2013, Color Company agreed to sell a diamond to a customer at a special price of $4,000. In return, the customer signed a non-interest bearing note payable to Color Company. Payment terms were $800 on January 1, 2013, and $800 each January 1 from 2014 to 2017. Color normally charges 8% interest to its customers.
What amount of revenue and accounts receivable should Color recognize on January 1, 2013?

On January 1, 2013, Color Company Agreed to Sell a Diamond