Tying It All Together Case F:2-1
Part of Universal Logistics Holdings, Inc.’s (NASDAQ: ULH) services involves providing freight shipments for customers. Services, such as shipping cars and trucks, are a significant part of the company’s revenues. For example, services provided to General Motors Company (NYSE: GM), one of ULH’s top customers, accounted for approximately 14% of total revenues during 2020. Universal Logistics Holdings’ 2021 annual reportLinks to an external site..
Requirements
- Suppose Universal Logistics Holdings, Inc. provides $10,500 of freight shipments to the General Motors Company during the month of November. How would Universal Logistics Holdings record this transaction? Assume General Motors Company paid in cash. What financial statement(s) would this transaction affect?
- Assume Universal Logistics Holdings, Inc. received $24,000 for an annual contract to provide transportation services for a global beverage company. How would ULH record this transaction? What financial statement(s) would this transaction affect?
- What is the difference in how revenue is recorded in requirements 1 and 2? Clearly state when revenue is recorded in each requirement.