Consider Each of the Following Scenarios for Bunsen Suppliers Company

question 70

Essay

Consider each of the following scenarios for Bunsen Suppliers Company:
a. The common practice of Bunsen Suppliers is to obtain a written sales agreement. When an Anson Store called on the phone with an urgent need, however, Bunsen orally agreed to deliver goods in exchange for
$6,000, then immediately delivered these goods to Anson without a written agreement.
b. Bunsen Suppliers has a written agreement to deliver goods to Comfort Inc. for $110 per unit. The price will drop to $95 per unit for all units if Comfort purchases more than 1,000 units per month.
c. Bunsen Suppliers has a written agreement with Darwin Company to deliver 800 units of product each
Saturday afternoon. Darwin can alter the quantity or cancel a delivery any time before noon Saturday.
Required:
Determine if a contract exists for each of these scenarios and comment on revenue recognition issues.

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Definitions:

Colors

The property possessed by an object of producing different sensations on the eye as a result of the way it reflects or emits light.

Proportion of Calories

The ratio of specific nutrients or food components (like fats, proteins, carbohydrates) to the total caloric intake.

Beverages

Liquid drinks designed for human consumption, including water, tea, coffee, soda, and alcoholic drinks.

Speed Up Metabolism

The process of increasing the rate at which the body converts food into energy, often through physical activity or dietary changes.