Sandhill 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. Sandhill Bundle A sells a tablet with 3 years Internet service. The price for the tablet and a 3-year Internet connection service contract is $455. The standalone selling price of the tablet is $234 (the cost to Sandhill Company is $171). Sandhill Company sells the Internet access service independently for an upfront payment of $270. On January 2, 2020, Sandhill Company signed 90 contracts, receiving a total of $40,950 in cash. Sandhill 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 $551. Sandhill Company provides the 3-year tablet service plan as a separate product with a standalone selling price of $140. Sandhill Company signed 180 contracts for Sandhill Bundle B on July 1, 2020, receiving a total of $99,180 in cash. 2. In response to competitive pressure for Internet access for Sandhill Bundle A, after 2 years of the 3-year contract, Sandhill Company offers a modified contract and extension incentive The extended contract services are similar to those provided in the fırst 2 vears of
Sandhill 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. Sandhill Bundle A sells a tablet with 3 years Internet service. The price for the tablet and a 3-year Internet connection service contract is $455. The standalone selling price of the tablet is $234 (the cost to Sandhill Company is $171). Sandhill Company sells the Internet access service independently for an upfront payment of $270. On January 2, 2020, Sandhill Company signed 90 contracts, receiving a total of $40,950 in cash. Sandhill 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 $551. Sandhill Company provides the 3-year tablet service plan as a separate product with a standalone selling price of $140. Sandhill Company signed 180 contracts for Sandhill Bundle B on July 1, 2020, receiving a total of $99,180 in cash. 2. In response to competitive pressure for Internet access for Sandhill Bundle A, after 2 years of the 3-year contract, Sandhill Company offers a modified contract and extension incentive The extended contract services are similar to those provided in the fırst 2 vears of
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 15RE: GameDay sells recreational vehicles along with secure parking storage to customers. Game Day sells...
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Journal is the book of original entry in which all the financial transactions relating to the business are recorded initially.
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