53 kes Video Planet (VP) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, and on-site installation by VP staff. The installation includes programming the remote to have the TV interface with other parts of the customer's home entertainment. system. VP concludes that the TV, remote, and installation service are separate performance obligations. VP sells the 60-inch TV separately for $2,040, sells the remote separately for $120, and offers the installation service separately for $240. The entire package sells for $2,300. Required: How much revenue would be allocated to the TV, the remote, and the installation service? (Do not round intermediate calculations.) Item Description TV Remote Installation Total revenue Allocated Revenue $ 0

53 kes Video Planet (VP) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, and on-site installation by VP staff. The installation includes programming the remote to have the TV interface with other parts of the customer's home entertainment. system. VP concludes that the TV, remote, and installation service are separate performance obligations. VP sells the 60-inch TV separately for $2,040, sells the remote separately for $120, and offers the installation service separately for $240. The entire package sells for $2,300. Required: How much revenue would be allocated to the TV, the remote, and the installation service? (Do not round intermediate calculations.) Item Description TV Remote Installation Total revenue Allocated Revenue $ 0

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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Video Planet (VP) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, and on-site installation by VP staff. The installation includes programming the remote to have the TV interface with other parts of the customer’s home entertainment system. VP concludes that the TV, remote, and installation service are separate performance obligations. VP sells the 60-inch TV separately for $1,435, sells the remote separately for $205, and offers the installation service separately for $410. The entire package sells for $1,950. Required: How much revenue would be allocated to the TV, the remote, and the installation service? Note: Do not round intermediate calculations.
Video Planet (VP) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, andon-site installation by VP staff. The installation includes programming the remote to have the TV interface withother parts of the customer’s home entertainment system. VP concludes that the TV, remote, and installationservice are separate performance obligations. VP sells the 60-inch TV separately for $1,750 and sells the remoteseparately for $100, and offers the entire package for $1,900. VP does not sell the installation service separately.VP is aware that other similar vendors charge $150 for the installation service. VP also estimates that it incursapproximately $100 of compensation and other costs for VP staff to provide the installation service. VP typicallycharges 40% above cost on similar sales.Required:1. Estimate the stand-alone selling price of the installation service using the adjusted market assessment approach.2. Estimate the stand-alone selling price of the…
Sonya, Inc. (SONI) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote,and onsite installation by SONI staff. The installation includes programming the remote to have theTV interface with other parts of the customer’s home entertainment system. SONI concludes that theTV, remote, and installation service are separate performance obligations. SONI sells the 60-inch TVseparately for P17,500, sells the remote separately for P1,000 and offers the entire package P19,000.SONI does not sell the installation service separately. SONI is aware that other similar vendors chargeP1,500 for the installation service. SONI also estimated that it incurs approximately P1,000 ofcompensation and other costs for SONI staff to provide the installation service. SONI typicallycharges 40% above cost on similar sales.Estimate the stand-alone selling price of the installation service using the adjusted marketassessment approach?
Video Planet (VP) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, and on-site installation by VP staff. The installation includes programming the remote to have the TV interface with other parts of the customer’s home entertainment system. VP concludes that the TV, remote, and installation service are separate performance obligations. VP sells the 60-inch TV separately for $1,750 and sells the remote separately for $100, and offers the entire package for $1,900. VP does not sell the installation service separately. VP is aware that other similar vendors charge $150 for the installation service. VP also estimates that it incurs approximately $100 of compensation and other costs for VP staff to provide the installation service. VP typically charges 40% above cost on similar sales. Required: 1. to 3. Calculate the stand-alone selling price of the installation service using each of the following approaches. 1. Adjusted Market Assessment = 2. Expected…
Video Planet (VP) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, and on-site installation by VP staff. The installation includes programming the remote to have the TV interface with other parts of the customer’s home entertainment system. VP concludes that the TV, remote, and installation service are separate performance obligations. VP sells the 60-inch TV separately for $1,750 and sells the remote separately for $100, and offers the entire package for $1,900. VP does not sell the installation service separately. VP is aware that other similar vendors charge $150 for the installation service. VP also estimates that it incurs approximately $100 of compensation and other costs for VP staff to provide the installation service. VP typically charges 40% above cost on similar sales. Required: 1. to 3. Calculate the stand-alone selling price of the installation service using each of the following approaches. 1. Adjusted Market Approach 2. Expected Cost…
Video Planet (VP) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, and on-site installation by VP staff. The installation includes programming the remote to have the TV interface with other parts of the customer’s home entertainment system. VP concludes that the TV, remote, and installation service are separate performance obligations. VP sells the 60-inch TV separately for $2,150 and sells the remote separately for $300, and offers the entire package for $2,700. VP does not sell the installation service separately. VP is aware that other similar vendors charge $350 for the installation service. VP also estimates that it incurs approximately $300 of compensation and other costs for VP staff to provide the installation service. VP typically charges 50% above cost on similar sales. Required:1. to 3. Calculate the stand-alone selling price of the installation service using each of the following approaches.
Sonya, Inc. (SONI) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, and onsite installation by SONI staff. The installation includes programming the remote to have the TV interface with other parts of the customer’s home entertainment system. SONI concludes that the TV, remote, and installation service are separate performance obligations. SONI sells the 60-inch TV separately for P17,500, sells the remote separately for P1,000 and offers the entire package P19,000.SONI does not sell the installation service separately. SONI is aware that other similar vendors charge P1,500 for the installation service. SONI also estimated that it incurs approximately P1,000 of compensation and other costs for SONI staff to provide the installation service. SONI typically charges 40% above cost on similar sales. Estimate the stand-alone selling price of the installation service using the estimated cost plus a margin approach a. 1,400 b. 500 Estimate the…
Problem 18-01 (Part Level Submission) Waterway Company sells tablet PCs combined with Internet service, which permits the tablet to connect to the Internet anywhere and set up a Wi-Fi hot spot. It offers two bundles with the following terms. 1. Waterway Bundle A sells a tablet with 3 years of Internet service. The price for the tablet and a 3-year Internet connection service contract is $505. The standalone selling price of the tablet is $263 (the cost to Waterway Company is $160). Waterway Company sells the Internet access service independently for an upfront payment of $296. On January 2, 2020, Waterway Company signed 100 contracts, receiving a total of $50,500 in cash. 2. Waterway Bundle B includes the tablet and Internet service plus a service plan for the tablet PC (for any repairs or upgrades to the tablet or the Internet connections) during the 3-year contract period. That product bundle sells for $607. Waterway Company provides the 3-year tablet service plan as a…
Flounder Company sells tablet PCs combined with Internet service, which permits the tablet to connect to the Internet anywhere and set up a Wi-Fi hot spot. It offers two bundles with the following terms. 1. Flounder Bundle A sells a tablet with 3 years of Internet service. The price for the tablet and a 3-year Internet connection service contract is $469. The standalone selling price of the tablet is $230 (the cost to Flounder Company is $157). Flounder Company sells the Internet access service independently for an upfront payment of $292. On January 2, 2020, Flounder Company signed 100 contracts, receiving a total of $46,900 in cash. 2. Flounder Bundle B includes the tablet and Internet service plus a service plan for the tablet PC (for any repairs or upgrades to the tablet or the Internet connections) during the 3-year contract period. That product bundle sells for $574. Flounder Company provides the 3-year tablet service plan as a separate product with a standalone selling…
Tablet Tailors sells tablet PCs combined with Internet service (Tablet Bundle A) that permits the tablet to connect to the Internet anywhere (that is, set up a WiFi hot spot). The price for the tablet and a four-year Internet connection service contract is $450. The stand-alone selling price of the tablet is $225 (cost to Tablet Tailors $158). Tablet Tailors sells the Internet access service independently for an upfront payment of $100, plus $65 payments due January 2, 2021, 2022, and 2023. With an imputed interest rate of 8%, the stand-alone value of the service is $268. On January 2, 2020, Tablet Tailors signed 100 contracts, receiving a total of $28,249 in cash (full payment of $450 each in cash, less the present value of the note for the future service plan payments due January 2 each year), delivered the tablets, and started service for 100 tablet packages. Tablet Tailors has a calendar year end and records adjusting entries at the end of the year. Instructions a. Allocate the…
Wilson Links Products sells a product that involves two separate performance obligations: the SwingRight golf club weight and the SwingCoach teaching software. SwingRight has a stand-alone selling price of $185. Wilson sells both the SwingRight and the SwingCoach as a package deal for $270. The SwingCoach software is not sold separately. Wilson is aware that other vendors charge $170 for similar software, and Wilson’s prices are generally 10% lower than what is charged by those vendors. Wilson estimates that it incurs approximately $100 of cost per copy of the software, and usually charges 50% above cost on similar products.Estimate the stand-alone selling price of the software using the adjusted market assessment approach.
Problem 18-04 Bridgeport Appliance Co. manufactures low-price, no-frills appliances that are in great demand for rental units. Pricing and cost information on Bridgeport’s main products are as follows. Item StandaloneSelling Price (Cost) Refrigerator $500 ($260 ) Range 570 (270 ) Stackable washer/dryer unit 690 (400 ) Customers can contract to purchase either individually at the stated prices or a three-item bundle with a price of $1,800. The bundle price includes delivery and installation. Bridgeport also provides installation (not a separate performance obligation).Respond to the requirements related to the following independent revenue arrangements for Bridgeport Appliance Co. 1. YellowCard Property Managers operates upscale student apartment buildings. On May 1, 2020, Bridgeport signs a contract with YellowCard for 280 appliance bundles to be delivered and installed in one of its…