On July 15, 2024, Ortiz & Company signed a contract to provide EverFresh Bakery with an ingredient-weighing system for a price of $82,800. The system included finely tuned scales that fit into EverFresh's automated assembly line, Ortiz's proprietary software modified to allow the weighing system to function in EverFresh's automated system, and a one-year contract to calibrate the equipment and software on an as needed basis. If Ortiz was to provide these goods or services separately, it would charge $54,000 for the scales. $10,000 for the software, and $36,000 for the calibration contract. Ortiz delivered and installed the equipment and software on August 1, 2024, and the calibration service commenced on that date. Assume that the scales, software and calibration service are all separate performance obligations. How much revenue will Ortiz recognize in 2024 for this contract? Note: Do not round intermediate calculations.

On July 15, 2024, Ortiz & Company signed a contract to provide EverFresh Bakery with an ingredient-weighing system for a price of $82,800. The system included finely tuned scales that fit into EverFresh's automated assembly line, Ortiz's proprietary software modified to allow the weighing system to function in EverFresh's automated system, and a one-year contract to calibrate the equipment and software on an as needed basis. If Ortiz was to provide these goods or services separately, it would charge $54,000 for the scales. $10,000 for the software, and $36,000 for the calibration contract. Ortiz delivered and installed the equipment and software on August 1, 2024, and the calibration service commenced on that date. Assume that the scales, software and calibration service are all separate performance obligations. How much revenue will Ortiz recognize in 2024 for this contract? Note: Do not round intermediate calculations.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter17: Advanced Issues In Revenue Recognition

Section: Chapter Questions

Problem 19E: Rix Company sells home appliances and provides installation and service for its customers. On April...

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