Diversified Industries Sells Perishable Electronic Products

question 80

Essay

Diversified Industries sells perishable electronic products. Some must be shipped in reusable containers. Customers pay a deposit for each container. The deposit is equal to the container's cost. Customers receive a refund when the container is returned. During 2018, deposits collected on containers shipped were $700,000. Deposits are forfeited if containers are not returned in 18 months. Containers held by customers on January 1, 2018, were $330,000. During 2018, $410,000 was refunded and deposits of $25,000 were forfeited.
Required:
1. Prepare the appropriate journal entries for the deposits received and returned during 2018.
2. Determine the liability for refundable deposits to be reported in the December 31, 2018, balance sheet.

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Definitions:

Occupation

Pertains to an individual's regular activity or profession that they are trained for and perform for pay.

Affirmative Action

Policies or practices within organizations aimed at increasing opportunities for historically marginalized groups by considering those group memberships in decisions.

Historical Injustice

Refers to wrongs done in the past that have long-lasting effects, often leading to calls for reparations or apologies.

Ethnic Diversity

The presence of a wide range of ethnic groups within a society, contributing to cultural variety and complexity.