A New York City daily newspaper called Manhattan Today charges an annual subscription fee of $108. Customers prepay their subscriptions and receive 300 issues over the year. To attract more subscribers, the company offered new subscribers the ability to pay $110 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $100 per hour. The company estimates that approximately 30% of the coupons will be redeemed. Required: 1. How much revenue should Manhattan Today recognize upon receipt of the $110 subscription price? 2. How many performance obligations exist in this contract? 3. Prepare the journal entry to recognize sale of 12 new subscriptions, clearly identifying the revenue or deferred revenue associated with each performance obligation.

A New York City daily newspaper called Manhattan Today charges an annual subscription fee of $108. Customers prepay their subscriptions and receive 300 issues over the year. To attract more subscribers, the company offered new subscribers the ability to pay $110 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $100 per hour. The company estimates that approximately 30% of the coupons will be redeemed. Required: 1. How much revenue should Manhattan Today recognize upon receipt of the $110 subscription price? 2. How many performance obligations exist in this contract? 3. Prepare the journal entry to recognize sale of 12 new subscriptions, clearly identifying the revenue or deferred revenue associated with each performance obligation.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter17: The Management Of Cash And Marketable Securities

Section: Chapter Questions

Problem 10P

See similar textbooks

Similar questions

A New York City daily newspaper called “Manhattan Today” charges an annual subscription fee of $135. Customers prepay their subscriptions and receive 260 issues over the year. To attract more subscribers, the companyoffered new subscribers the ability to pay $130 for an annual subscription that also would include a coupon toreceive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of acarriage ride is $125 per hour. The company estimates that approximately 30% of the coupons will be redeemed.Required:1. How much revenue should Manhattan Today recognize upon receipt of the $130 subscription price?2. How many performance obligations exist in this contract?3. Prepare the journal entry to recognize sale of 10 new subscriptions, clearly identifying the revenue ordeferred revenue associated with each performance obligation.
A New York City daily newspaper called “Manhattan Today” charges an annual subscription fee of $135. Customers prepay their subscriptions and receive 260 issues over the year. To attract more subscribers, the company offered new subscribers the ability to pay $130 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $125 per hour. The company estimates that approximately 30% of the coupons will be redeemed. Required: How much revenue should Manhattan Today recognize upon receipt of the $130 subscription price? How many performance obligations exist in this contract? Prepare the journal entry to recognize sale of 10 new subscriptions, clearly identifying the revenue or deferred revenue associated with each performance obligation.
A New York City daily newspaper called “Manhattan Today” sells annual subscriptions for a fee of $216. To attract more subscribers, the company offered a package to new subscribers. The $210 cost of the package includes: an annual subscription and a coupon for a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $200 per hour. The company estimates that approximately 30% of the coupons will be redeemed. Required: How much revenue should Manhattan Today recognize upon receipt of the $210 subscription price? How many performance obligations exist in this contract? Prepare the journal entry to recognize sale of 15 new subscriptions, clearly identifying the revenue or deferred revenue associated with each performance obligation.
A New York City daily newspaper called “Manhattan Today” charges an annual subscription fee of $135. Customers prepay their subscriptions and receive 260 issues over the year. To attract more subscribers, the company offered new subscribers the ability to pay $130 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $125 per hour. The company estimates that approximately 30% of the coupons will be redeemed. Prepare the journal entry to recognize sale of 10 new subscriptions, clearly identifying the revenue or deferred revenue associated with each performance obligation. The correct answer is: DR Cash - $1,300 CR Deferred Revenue - discount coupon $130 CR Deferred Revenue - subscription $1,170 ...but I have no idea how "they" came up with the deferred revenue costs. I've asked my professor, but since it's an online summer course, they're not into…
K A New York City daily newspaper called Manhattan Today charges an annual subscription fee of $108. Customers prepay their subscriptions and receive 250 issues over the year. To attract more subscribers, the company offered new subscribers the ability to pay $110 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $100 per hour. The company estimates that approximately 30% of the coupons will be redeemed. Required: 1. How much revenue should Manhattan Today recognize upon receipt of the $110 subscription price? 2. How many performance obligations exist in this contract? 3. Prepare the journal entry to recognize sale of 14 new subscriptions, clearly identifying the revenue or deferred revenue associated with each performance obligation.
Mammoth Publishing, Inc. owns a weekly magazine called “Nova Health,” and sells annual subscriptions for $96. Customers prepay their subscription fee and receive 52 issues starting in the following month. The company also offers new subscribers a 25% discount coupon on its other weekly magazine called “Fishing & Camping,” which has a list price of $84 for an annual subscription. Mammoth estimates that approximately 10% of the discount coupons will be redeemed.Required:(a) How many performance obligations are in a single subscription contract?(b) Prepare the journal entry to account for one new subscription of “Nova Health,” clearly identifying the revenue or deferred revenue associated with each performance obligation. of performance obligations: 2 Journal entry worksheet Note: Enter debits before credits. Transaction General Journal Debit Credit 1
Mammoth Publishing, Incorporated owns a weekly magazine called “Nova Health,” and sells annual subscriptions for $86. Customers prepay their subscription fee and receive 52 issues starting in the following month. The company also offers new subscribers a 30% discount coupon on its other weekly magazine called “Fishing & Camping,” which has a list price of $70 for an annual subscription. Mammoth estimates that approximately 10% of the discount coupons will be redeemed.\\n\\nRequired:\\n(a) How many performance obligations are in a single subscription contract?\\n\\n(b) Prepare the journal entry to account for one new subscription of “Nova Health,” clearly identifying the revenue or deferred revenue associated with each performance obligation.
Curt Rugs is holding a 2-week carpet sale at Jean's Club, a local warehouse store. Curt Rugs plans to sell carpets for $1,000 each. The company will purchase the carpets from a local distributor for $400 each, with the privilege of returning any unsold units for a full refund. Jean's Club has offered Curt Rugs two payment alternatives for the use of space. Read the requirements. Requirement 1. Calculate the breakeven point in units for (a) option 1 and (b) option 2. Begin by determining the formula to calculate the breakeven point in units. Number of units to breakeven More Info • Option 1: A fixed payment of $17,400 for the sale period • Option 2: 20% of total revenues earned during the sale period Assume Curt Rugs will incur no other costs.
A vendor is running a promotion whereby a consumer who purchases three boxes of golf balls at P20 per box in a single transaction receives an offer for one free box of golf balls if the customer fills out a request form and mails it to the vendor before a set expiration date (a mail-in rebate). The vendor estimates, based on recent experience with similar promotions, that 80% of the customers will complete the mail-in rebate required to receive the free box of golf balls. How much of the transaction price is allocated to the mail-in rebate?
Anton Company sells one dozen doughnuts for P500 per box. There is a promotion wherein if a customer buys 3 boxes in a single transaction, a customer received a coupon for one additional box for free. Customers can redeem coupons at any time following the month of sale of the 3 boxes before the expiration date. It is expected 60% of the customers will redeem the coupons. During 2022, the entity sold 15,000 boxes at P500 per box or P7,500,000. During 2023, the entity delivered 2,000 free additional boxes to the customers. Required: 1. Compute the stand-alone selling price of the coupons. 2. Allocate the transaction price to the products sold and the coupons. 3. Prepare the journal entry to record the sale of the products and issue of the free product coupons in 2022 4. Prepare the journal entry to record the delivery of 2,000 free additional boxes in 2023.
A new book publishing and sales project estimates that the first year 7,000 printed units and 2,000 digital units will be sold.The printer will charge them $5 for each book.The publisher will sell the books for $12 each.The virtual books will be sold for $6 through a platform and the publisher receives $3.The authors of the books receive 5% of the sales made by the publisher, whether online or in print, which is recorded as an expense. The market study suggests that sales of printed books can increase at 20% per year and those of digital format at 30% per year.The initial equipment will be reduced, since they work with the subcontracting of printed material. Basically, they include computer equipment, software and furniture that have a value of 20,000; In addition, a vehicle will be purchased for a value of 15,000. Computer equipment, software and furniture are depreciated instraight line in 5 years. In year 6, these equipments must be bought again for the same value.The vehicle is…
Blossom Inc. sells prepaid telephone cards to customers in its convenience stores. When Blossom sells cards, it then pays the telecommunications company, Cullumber, for the value of the cards less a 20% commission. Assume that Blossom receives $4,000 of prepaid cards in January 2025. Blossom sold 50% of the cards in February, 30% in March, and 20% in April. The total payment by Blossom to Cullumber over the 3 months is $3,200. Indicate how much income Blossom should recognize in January, February, March, and April. (If answer is 0, please enter O. Do not leave any fields blank.)