True Tech Industries manufactures the Tri-Box System, a multiplayer gaming system allowing players to compete with each other over the Internet. •The Tri-Box System includes the physical Tri-Box module as well as a one-year subscription to the Tri-Net multiuser platform of Internet-based games and other applications. •True Tech sells individual one-year subscriptions to the Tri-Net platform for $80. Customers can access the Tri-Net using a Tri-Box as well as other gaming modules. •True Tech sells individual Tri-Box modules for $320. Customers can use a Tri-Box to access the Tri-Net as well as other multiuser gaming platforms. •As a package deal, TrueTech sells the Tri-Box System (module plus subscription) for $350. On January 1, 2021, True Tech delivers 1,000 Tri-Box Systems to CompStores at a price of $350 per system. TrueTech receives $350,000 from CompStores on January 25, 2021. Which of the following statements is incorrect? O On January 31, 2021, TrueTech should recognize service revenue $6,667. O The transaction price is $350,000. O On January 1, 2021, TrueTech should recognize sales revenue $280,000 O A Tri-Box system includes two performance obligations.
True Tech Industries manufactures the Tri-Box System, a multiplayer gaming system allowing players to compete with each other over the Internet. •The Tri-Box System includes the physical Tri-Box module as well as a one-year subscription to the Tri-Net multiuser platform of Internet-based games and other applications. •True Tech sells individual one-year subscriptions to the Tri-Net platform for $80. Customers can access the Tri-Net using a Tri-Box as well as other gaming modules. •True Tech sells individual Tri-Box modules for $320. Customers can use a Tri-Box to access the Tri-Net as well as other multiuser gaming platforms. •As a package deal, TrueTech sells the Tri-Box System (module plus subscription) for $350. On January 1, 2021, True Tech delivers 1,000 Tri-Box Systems to CompStores at a price of $350 per system. TrueTech receives $350,000 from CompStores on January 25, 2021. Which of the following statements is incorrect? O On January 31, 2021, TrueTech should recognize service revenue $6,667. O The transaction price is $350,000. O On January 1, 2021, TrueTech should recognize sales revenue $280,000 O A Tri-Box system includes two performance obligations.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:TrueTech Industries manufactures the Tri-Box System, a multiplayer gaming system allowing players to compete with each other over the Internet.
•The Tri-Box System includes the physical Tri-Box module as well as a one-year subscription to the Tri-Net multiuser platform of Internet-based games and other applications.
•True Tech sells individual one-year subscriptions to the Tri-Net platform for $80. Customers can access the Tri-Net using a Tri-Box as well as other gaming modules.
•True Tech sells individual Tri-Box modules for $320. Customers can use a Tri-Box to access the Tri-Net as well as other multiuser gaming platforms.
•As a package deal, TrueTech sells the Tri-Box System (module plus subscription) for $350.
On January 1, 2021, True Tech delivers 1,000 Tri-Box Systems to CompStores at a price of $350 per system. TrueTech receives $350,000 from CompStores on January 25, 2021.
Which of the following statements is incorrect?
O On January 31, 2021, TrueTech should recognize service revenue $6,667.
O The transaction price is $350,000.
O On January 1, 2021, TrueTech should recognize sales revenue $280,000
O A Tri-Box system includes two performance obligations.
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