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 $2,295, sells the remote separately for $135, and offers the installation service separately for $270. The entire package sells for $2,600. Required: How much revenue would be allocated to the TV, the remote, and the installation service? Note: Do not round intermediate calculations. Item Description Allocated Revenue

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 $2,295, sells the remote separately for $135, and offers the installation service separately for $270. The entire package sells for $2,600. Required: How much revenue would be allocated to the TV, the remote, and the installation service? Note: Do not round intermediate calculations. Item Description Allocated Revenue

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 3C

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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?
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…
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…
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…
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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 $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.
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 $1,700, sells the remote separately for $100, and offers the installation service separately for $200. The entire package sells for $1,900. Required: How much revenue would be allocated to the TV, the remote, and the installation service?
Windsor Windows manufactures and sells custom storm windows for enclosed porches. Windsor also provides installation service for the windows. The installation process does not involve changes in the windows, so this service can be provided by other vendors. Windsor enters into the following contract on June 1, 2018, with a local homeowner. The customer purchases windows for a price of £4,700 and chooses Windsor to do the installation. Windsor charges the same price for the windows irrespective of whether it does the installation or not. The price of the installation service is estimated to have a fair value of £1,200. The customer pays Windsor £4,000 (which equals the fair value of the windows, which have a cost of £2,300) upon delivery and the remaining balance upon installation of the windows. The windows are delivered on August 1, 2018, Windsor completes installation on September 15, 2018, and the customer pays the balance due. Prepare the journal entries for Windsor in 2018. (Round…
46.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 P17,000,sells the remote separately for P1,000, and offers the installation service separately for P2,000. The entire package sells for P19,000.How much revenue would be allocated to the TV, the remote, and the installation service,respectively? a. P16,150; P950;P1,900 b. 0;P1,900
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