1. Meyer & Smith is a full-service technology company. They provide equipment, installation services as well astraining. Customers can purchase any product or service separately or as a bundled package. ContainerCorporation purchased computer equipment, installation and training for a total cost of $144,000 on March15, 2018. Estimated standalone fair values of the equipment, installation, and training are $90,000, $60,000,and $30,000 respectively. The transaction price allocated to equipment, installation and training is$90,000, $60,000, $30,000 respectively$48,000, $48,000, $48,000 respectively$144,000 for the entire bundle$72,000, $48,000, $24,000 respectively

To allocate the transaction price to the equipment, installation, and training based on their…

Answered: 1. Meyer & Smith is a full-service…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A fully technology driven startup provide equipment, installation services as well as training. Customers can purchase any product or service separately or as a bundled package. These items are distinct and not interdependent. Booker purchased computer equipment, installation and training for a total cost of 129,600 on March 15, 2018 Estimated standalone fair values of the equipment, installation, and training are 75,000, 48,000, 21,000. respectively. The transaction price allocated to equipment, installation and training is and 21,000 a.$129,600 for the entire bundle,b. 67,500, 43.200 and 18,900 respectively, c.75,000, 48,000, and 21,000 respectively, d.43,200, 43,200, and 43,200 respectively
ONE Computer Solution (“ONE") provides IT solutions to corporate clients. ONE offered a price of $2,400 to Client A if he purchases an accounting software from them and choose them to do the installation. Client A agreed and entered into a contract with ONE on 1 January 2022. ONE normally charges clients $2,000 as a standalone selling price for acquiring the accounting software, at a cost of $1,100. The installation service has a standalone selling price of $500. Client A paid ONE $2,000 upon delivery and the remaining balance upon installation of the software. The accounting software was delivered on 1 February 2022. ONE completed installation on 1 March 2022 and client A paid the balance due. Required: (a) Allocate the transaction price between the accounting software and installation service. (b) Prepare the journal entries on the following date (Note: If no entry is required, state “no entry" and write down the reason to support your answer): (i) 1 January 2022. (ii) 1 February…
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AAA Company signed a contract charging a customer P600,000 to change the windows of a customer's house. The contract includes costs for materials and labor. The Company would charge P250,000 for materials if sold separately and P500,000 for labor if the customer will purchase the needed materials. How much of the transaction price would the company allocate to its performance obligation to provide the needed services to the customer?
Meyer & Smith is a full-service technology company. They provide equipment, installation services as well as training. Customers can purchase any product or service separately or as a bundled package. Sunland Corporation purchased computer equipment, installation and training for a total cost of $ 135405 on March 15, 2021. Estimated standalone fair values of the equipment, installation and training are $ 88500, $ 44400 and $ 26400 respectively. The journal entry to record the transaction on March 15, 2021 will include a O credit to Sales Revenue for $ 135405. O credit to Unearned Service Revenue of $ 22440. O debit to Unearned Service Revenue of $ 26400. O credit to Service Revenue of $ 44400.
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am. 116.
Sheffield Corporation wishes to exchange a machine used in its operations. Sheffield has received the following offers from other companies in the industry. 2. 3. Tamarisk Company offered to exchange a similar machine plus $30,820. (The exchange has commercial substance for both parties) Vaughn Company offered to exchange a similar machine. (The exchange lacks commercial substance for both parties.) Bramble Company offered to exchange a similar machine, but wanted $4,020 in addition to Sheffield's machine. (The exchange has commercial substance for both parties.) In addition, Sheffield contacted Sunland Corporation, a dealer in machines. To obtain a new machine, Sheffield must pay $124,620 in addition to trading in its old machine. Machine cost Accumulated depreciation Fair valut Sheffield $214,400 80,400 123,280 Tamarisk Vaughn Bramble $160,800 $203,680 $214,400 60,300 95.140 100,500 92,460 123,280 127,300 Sunland $174.200 -0- 247,900 For each of the four independent situations,…
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