The Rink offers annual $350 memberships that entitle members to unlimited use of ice-skating facilities and locker rooms. Each new membership also entitles the member to receive ten "20% off a $5 meal" coupons that are redeemable at the Rink's snack bar. The Rink estimates that approximately 80% of the coupons will be redeemed, and that, if the coupons weren't redeemed, $5 meals still would be discounted by 5% because of ongoing promotions. Required: Calculate how much of the transaction price should be allocated to each performance obligation in the contract. Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Meal Transaction price Ice-skating facilities and locker rooms
The Rink offers annual $350 memberships that entitle members to unlimited use of ice-skating facilities and locker rooms. Each new membership also entitles the member to receive ten "20% off a $5 meal" coupons that are redeemable at the Rink's snack bar. The Rink estimates that approximately 80% of the coupons will be redeemed, and that, if the coupons weren't redeemed, $5 meals still would be discounted by 5% because of ongoing promotions. Required: Calculate how much of the transaction price should be allocated to each performance obligation in the contract. Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Meal Transaction price Ice-skating facilities and locker rooms
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![The Rink offers annual $350 memberships that entitle members to unlimited use of ice-skating facilities and locker rooms. Each new
membership also entitles the member to receive ten "20% off a $5 meal" coupons that are redeemable at the Rink's snack bar. The
Rink estimates that approximately 80% of the coupons will be redeemed, and that, if the coupons weren't redeemed, $5 meals still
would be discounted by 5% because of ongoing promotions.
Required:
Calculate how much of the transaction price should be allocated to each performance obligation in the contract.
Note: Do not round intermediate calculations. Round your answer to 2 decimal places.
Meal
Transaction price
Ice-skating facilities and locker rooms](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6eeb0c2f-a8aa-42df-bc09-c1d50c4ef639%2F52f97cb5-9e45-40d7-8e74-669c9f0a13ce%2F9h5o3f07_processed.png&w=3840&q=75)
Transcribed Image Text:The Rink offers annual $350 memberships that entitle members to unlimited use of ice-skating facilities and locker rooms. Each new
membership also entitles the member to receive ten "20% off a $5 meal" coupons that are redeemable at the Rink's snack bar. The
Rink estimates that approximately 80% of the coupons will be redeemed, and that, if the coupons weren't redeemed, $5 meals still
would be discounted by 5% because of ongoing promotions.
Required:
Calculate how much of the transaction price should be allocated to each performance obligation in the contract.
Note: Do not round intermediate calculations. Round your answer to 2 decimal places.
Meal
Transaction price
Ice-skating facilities and locker rooms
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