General Motors has always shut down for one week at the end of December for routine maintenance of the company’s equipment. The annual maintenance is essential to ensure that it's equipment can meet the precise specifications of customers. For the past three years, maintenance has been completed by the end of December. The annual maintenance originally scheduled for Dec 2018 was delayed until the first week of January 2019 because of scheduling problems with the company that does the maintenance and because it had a number of contracts it wanted to complete by the end of December. The last maintenance was done in December 2017. General Motors paid $500,000 for the January 2019 maintenance work which was paid in mid-January.

Please help me figure out what is wrong in this scenario and/or how I would have to account for this in the books for the fiscal year-end 2018. Thank you.

asked by TY

5 years ago

641 views

0

0

Ask a New Question or answer this question.

Question

General Motors has always shut down for one week at the end of December for routine maintenance of the company’s equipment. The annual maintenance is essential to ensure that it's equipment can meet the precise specifications of customers. For the past three years, maintenance has been completed by the end of December. The annual maintenance originally scheduled for Dec 2018 was delayed until the first week of January 2019 because of scheduling problems with the company that does the maintenance and because it had a number of contracts it wanted to complete by the end of December. The last maintenance was done in December 2017. General Motors paid $500,000 for the January 2019 maintenance work which was paid in mid-January.
 
Please help me figure out what is wrong in this scenario and/or how I would have to account for this in the books for the fiscal year-end 2018. Thank you.