ABC, Inc. prepares its financial statements consistent with a 12/31 fiscal period end. On 9/30/2014 ABC, nc. received $150,000 for a basket of goods and services that were sold to XYZ, Inc. In exchange for the $150,000 ABC, Inc. agreed to deliver and install a state of the art machine on 10/1/2014, they also agreed to conduct an 8-hour training session for the current employees on 10/15/2014, and to conduct a second 8-hour training session on 1/15/2015. Finally, ABC, Inc. will provide five years of customer support which will begin on 10/1/2014. If sold separately, ABC, Inc. generally charges the following: Amount $150,000 Machine
ABC, Inc. prepares its financial statements consistent with a 12/31 fiscal period end. On 9/30/2014 ABC, nc. received $150,000 for a basket of goods and services that were sold to XYZ, Inc. In exchange for the $150,000 ABC, Inc. agreed to deliver and install a state of the art machine on 10/1/2014, they also agreed to conduct an 8-hour training session for the current employees on 10/15/2014, and to conduct a second 8-hour training session on 1/15/2015. Finally, ABC, Inc. will provide five years of customer support which will begin on 10/1/2014. If sold separately, ABC, Inc. generally charges the following: Amount $150,000 Machine
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:ABC, Inc. prepares its financial statements consistent with a 12/31 fiscal period end. On 9/30/2014 ABC,
Inc. received $150,000 for a basket of goods and services that were sold to XYZ, Inc. In exchange for the
$150,000 ABC, Inc. agreed to deliver and install a state of the art machine on 10/1/2014, they also
agreed to conduct an 8-hour training session for the current employees on 10/15/2014, and to conduct a
second 8-hour training session on 1/15/2015. Finally, ABC, Inc. will provide five years of customer
support which will begin on 10/1/2014. If sold separately, ABC, Inc. generally charges the following:
Amount
Machine
$150,000
Installation
$14,000
Training
$1,000 per hour
Customer Support
$20,000
When ABC, Inc. prepares their financial statements on 12/31/2014, how much will the record for
Revenue for 2014?
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