TEST XQ’s Software Development Division (SDD) has developed several architectural design software packages. One software package that they have developed is being sold to English Company for $250,000 or 325,000 pounds. The cost of developing the software was $195,000. As payment, XQ has accepted a note receivable that is due in 5 years. SDD has also developed a second software package. They incurred development costs of $410,000. They are trading this software package in exchange for a small office building. The fair market value of this building is $600,000. In an Excel spreadsheet, make the accounting entry on XQ’s books for each software sale. Include 13 paragraphs discussing the accounting issues involved for each sale. Use $235,000 as the discounted value of the note receivable.
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