Guy prepares its annual financial statement every June He has performed the needed grass cutting services needed for the current fiscal year. How much revenue (rounded to the nearest peso) should Guy Sebastian recognize in its June 30, 2020 income statement arising from the above contract?
On February 12, 2020, Guy Sebastian Gardening Services enters into a contract with a local business to provide a weekly grass cutting services between May 1 and September 30 of that year, and received P2,000 in advance. As part of a local business promotion, Guy Sebastian offers a 50% discount on any gardening tools it also sells with a list price in excess of P200. In the past, Guy Sebastian charged the same amount (P2,000) for the same weekly grass cutting service, but without the gardening tool discount coupon. Based on historical experience with other clients, Guy estimates that about 40% of the coupons will be redeemed, purchasing tools with an average total list price of P400.
Guy prepares its annual financial statement every June He has performed the needed grass cutting services needed for the current fiscal year. How much revenue (rounded to the nearest peso) should Guy Sebastian recognize in its June 30, 2020 income statement arising from the above contract?
Step by step
Solved in 4 steps with 3 images
