In each instance in which maintenance services are provided, the maintenance service is separately priced within the arrangement at $170. Additionally, the incremental amount charged by Cullumber Center for installation approximates the amount charged by independent third parties. Ovens are sold subject to a general right of return. If a customer purchases an oven with installation and/o maintenance services, in the event Cullumber Center does not complete the service satisfactorily, the customer is only entitled to a refund of the portion of the fee that exceeds $790. Assume that a customer purchases an oven with both installation and maintenance services for $909. Based on its experience, Cullumber Center believes that it is probable that the installation of the equipment will be performed satisfactorily to the customer. Assume that the maintenance services are priced separately (i.e., the three components are distinct). (b) Indicate the amount of revenue that should be allocated to the oven, the installation, and to the maintenance contract. (Do not rou intermediate calculations. Round final answers to O decimal places, e.g. 5,275.)

In each instance in which maintenance services are provided, the maintenance service is separately priced within the arrangement at $170. Additionally, the incremental amount charged by Cullumber Center for installation approximates the amount charged by independent third parties. Ovens are sold subject to a general right of return. If a customer purchases an oven with installation and/o maintenance services, in the event Cullumber Center does not complete the service satisfactorily, the customer is only entitled to a refund of the portion of the fee that exceeds $790. Assume that a customer purchases an oven with both installation and maintenance services for $909. Based on its experience, Cullumber Center believes that it is probable that the installation of the equipment will be performed satisfactorily to the customer. Assume that the maintenance services are priced separately (i.e., the three components are distinct). (b) Indicate the amount of revenue that should be allocated to the oven, the installation, and to the maintenance contract. (Do not rou intermediate calculations. Round final answers to O decimal places, e.g. 5,275.)

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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