Manufactures-sells custom storm windows for enclosed porches

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Jones manufactures and sells custom storm windows for enclosed porches. Jones also provides installation service for the windows. The installation process does not involve changes in the windows, so this service can be provided by other vendors. Jones enters into the following contract on June 1, 2014, with a local homeowner. The customer purchases windows for a price of $3,500 and chooses Jones to do the installation. Jones charges the same price for the windows irrespective of whether it does the installation or not. The price of the installation service is estimated to have a fair value of $900. The customer pays Jones $3,000 (which equals the fair value of the windows, which have a cost of $1,700) upon delivery and the remaining balance upon installation of the windows. The windows are delivered on August 1, 2014, Jones completes installation on September 15, 2014, and the customer pays the balance due. Prepare the journal entries for Jones in 2014. (Round amounts to nearest dollar.)

Reference no: EM13863686

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