Delta Spirit, Inc. entered into a contract to sell equipment to Wilco, LLC on October 1, 2021. Along with the equipment, Delta Spirit will provide one-year maintenance services on an as-needed basis, beginning once the equipment is installed. Delta Spirit offers similar services to other customers that purchased equipment sold by other vendors for $20,000. Delta Spirit will also provide installation services at no additional cost, a service that Delta Spirit typically charges $10,000. The equipment normally sells for $170,000 on its own. For the package deal, Wilco agrees to pay a total of $180,000. The equipment was delivered and installed on November 1, 2021. Wilco paid the entire invoice in cash on the delivery and installation date. How much revenue should Delta Spirit allocate to the various performance obligations in the above contract (round to the nearest dollar, if needed)?
Delta Spirit, Inc. entered into a contract to sell equipment to Wilco, LLC on October 1, 2021. Along with the equipment, Delta Spirit will provide one-year maintenance services on an as-needed basis, beginning once the equipment is installed. Delta Spirit offers similar services to other customers that purchased equipment sold by other vendors for $20,000. Delta Spirit will also provide installation services at no additional cost, a service that Delta Spirit typically charges $10,000. The equipment normally sells for $170,000 on its own. For the package deal, Wilco agrees to pay a total of $180,000. The equipment was delivered and installed on November 1, 2021. Wilco paid the entire invoice in cash on the delivery and installation date.
How much revenue should Delta Spirit allocate to the various performance obligations in the above contract (round to the nearest dollar, if needed)?
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