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Pacifica Fitness Ltd is marketing a 'fitness package' in which, for $440, it provides customers with a 6-month gym membership (which retails separately for $500, a gym bag (which retails separately for $35) and five free zumba classes (which retail separately for 65). You are required to determine:
- a) Separate performance obligations and how much of the transaction price to allocate to each performance obligation.
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- Pacifica Fitness Ltd Is Marketing A 'Fitness Package' In Which, For $400, It Provides Customers With A 6-Month Gym Membership (Which Retails Separately For $530, A Gym Bag (Which Retails Separately For $32) And Five Free Zumba Classes (Which Retail Separately For 69). You Are Required To Determine: (10 Marks) A) Separate Performance Obligations And How Much Pacifica Fitness Ltd is marketing a 'fitness package' in which, for $400, it provides customers with a 6-month gym membership (which retails separately for $530, a gym bag (which retails separately for $32) and five free zumba classes (which retail separately for 69). You are required to determine: a) Separate performance obligations and how much of the transaction price to allocate to each performance obligation. Good or Service Stand-alone Price Discount Allocation Allocated Amount Total b) Pacifica Fitness Ltd sold 19 packages advance and receive first payment on 30 May 2023.…Pacifica Fitness Ltd is marketing a 'fitness package' in which, for $ 400 , it provides customers with a 6-month gym membership (which retails separately for $ 510 , a gym bag (which retails separately for $ 39 ) and five free zumba classes (which retail separately for 67 ). You are required to determine: a) Separate performance obligations and how much of the transaction price to allocate to each performance obligation. Good or Service Stand-alone Price Discount Allocation Allocated Amount Gym Membership Gym Bag Zumba Classes Gym Membership Gym Bag Zumba Classes Gym Membership Gym Bag Zumba Classes Total b) Pacifica Fitness Ltd sold 15 packages advance and receive first payment on 30 May 2023. The reporting period is 30 June 2023. Provide the accounting entries to record the receipt of the cash and the subsequent reporting date adjustment. 30 May 2023 Debit/Credit Description Debit Amount Credit Amount Debit…ABC Ltd is marketing a ‘surfing bundle’ in which, for $3200, it provides customers with a surfboard (which retails separately for $2550), a wetsuit (which retails separately for $750) and five lessons (which retail separately for $600). You are required to determine: How much of the transaction price to allocate to each performance obligation?
- Pacifica Fitness Ltd is marketing a 'fitness package' in which, for $400, it provides customers with a 6-month gym membership (which retails separately for $530, a gym bag (which retails separately for $32) and five free zumba classes (which retail separately for 69). You are required to determine: a) Separate performance obligations and how much of the transaction price to allocate to each performance obligation. Good or Service Stand-alone Price Discount Allocation Allocated Amount Total b) Pacifica Fitness Ltd sold 19 packages advance and receive first payment on 30 May 2023. The reporting period is 30 June 2023. Provide the accounting entries to record the receipt of the cash and the subsequent reporting date adjustment. 30 May 2023 Debit/Credit Description Debit Amount Credit Amount 30 June 2023 Debit/Credit Description Debit Amount Credit Amount c) What is the balance of…Surfside Ltd is marketing a surfing bundle in which, for $1100, it provides customers with a surfboard (which retails separately for $850), a wetsuit (which retails separately for $250), and five lessons (which retail for $200). You are required to determine: Whether separate performance obligations exist, and to explain why you made this judgement. How much of the transaction price to allocate to each performance obligation?Lawnclippers, Inc. is offering a fall promotion to new customers signing a contract within the next two weeks. For a bundled price of $99, Lawnclippers will provide fall aeration, lawn seeding and tree fertilization. The standalone price of each service sold separately is fall aeration $69, lawn seeding $20, and tree fertilization $29. Allocate the price to each of the three separate performace obligaions (rounding your final answer to the nearest whole dollar) How much is allocated to Fall Aeration? Question 24 options: a) $69 b) $82 c) $58 d) $33
- The business manager of an RSO has a choice of purchasing T-shirts for 500 students from two suppliers. Alpha T offers the shirt to be acquired at P300 each with print 500 pieces and silk screen cost of P1,000 for 500 pieces. If the RSO will buy less than 500 pieces, it will be charged at P315each. Beta T, another supplier offers the T-shirt at P187 each, charges printing at P10,000 at a higher level of printing technology for every 300 pieces, and P75/shirt for ink and labor. Record shows that sales come from 75% of the students buy T-shirts. If only 80% of the students are targeted to serve, which supplier will you choose? a) Alpha T b) Beta T c) Either of the two supplier d) none of the supplierABC Ltd is marketing a ‘surfing bundle’ in which, for $2200, it provides customers with a surfboard (which retails separately for $1700), a wetsuit (which retails separately for $500) and five lessons (which retail separately for $400). You are required to determine: Whether separate performance obligations exist, and to explain why you made this judgement.CoolShoes sells its elite tennis shoes to sports retailers throughout the country. When introducing its new RF17 shoes that sell for 125 per pair, the company includes a 15 rebate form. The rebate form can be used when the customer ultimately purchases the shoes. CoolShoes sells 100 pairs of shoes and estimates that 80% of the rebate forms will be returned by customers for a rebate. Determine the transaction price that CoolShoes should use when recognizing revenue from sale of one pair of the RF17 shoe.
- Markson and Sons leases a copy machine with terms that include a fixed fee each month of $500 plus a charge for each copy made. The company uses the high-low method to analyze costs. If Markson paid $360 for 5,000 copies and $280 for 3,000 copies, how much would Markson pay if it made 7,500 copies?Able Transport operates a tour bus that they lease with terms that involve a fixed fee each month plus a charge for each mile driven. Able Transport drove the bus 7,000 miles and paid a total of $1,360 in June. In October. Able Transport paid $1,280 for the 5,000 miles driven. If Able Transport uses the high-low method to analyze costs, how much would Able Transport pay in December, if they drove 6,000 miles?Jonas Consulting enters into a contract to provide cost management consulting services over a 1-year period for $10,000 per month. At the end of the contract, Jonas will either give the customer a $24,000 refund or be entitled to an additional $24,000, depending on the level of cost savings. The company believes there is an 80% chance that it will be entitled to an additional $24,000 and a 20% chance it will give a refund of $24,000. In addition, Jonas believes it is probable that a significant reversal of any previously recognized revenue will not occur. The contract performance is determined to be satisfied over time. Required: 1. Determine the monthly transaction price that Jonas should use for recording the contract and prepare Jonas’s journal entry at the end of the first month of the contract using the most likely amount approach.
