New Age Computers Manufactures and Sells Pagers and Radio Paging

question 19

Multiple Choice

New Age Computers manufactures and sells pagers and radio paging systems which include a 180 day warranty on product defects.It also sells an extended warranty which provides an additional two years of protection.On May 10, it sold a paging system for $3,850 and an extended warranty for another $1,200.The journal entry to record this transaction would include

• A)a credit to Service Revenue of $5,050.
• B)a credit to Service Revenue of $1,200
• C)a credit to Sales of $3,850 and a credit to Service Revenue of $1,200
• D)a credit to Unearned Service Revenue of $1,200.

---

Definitions:

OLED TVs

OLED TVs utilize organic light-emitting diodes to create stunning visuals with high contrast and vibrant colors, known for their thin profiles and efficient energy use.

Movie Tickets

Pre-purchased vouchers or electronic codes that allow the holder to watch a film at a movie theater.

Inferior Good

An Inferior Good is a type of good whose demand decreases as the income of consumers increases, contrasting with normal goods.

Income

This is the financial gain (money) earned by an individual or entity, usually over a period of time, through work, investments, or business ventures.