Creative Computing sells a tablet computer called the Protab. The $780 sales price of a Protab Package includes the following: .One Protab computer. • A six-month limited warranty. This warranty guarantees that Creative will cover any costs that arise due to repairs or replacements associated with defective products for up to six months. • A coupon to purchase a Creative Probook ebook reader for $200, a price that represents a 50% discount from the regular Probook price of $400. It is expected that 20% of the discount coupons will be utilized. . A coupon to purchase a one-year extended warranty for $50. Customers can buy the extended warranty for $50 at other times as well. Creative estimates that 40% of customers will purchase an extended warranty. . Creative does not sell the Protab without the limited warranty, option to purchase a Probook, and the option to purchase an extended warranty, but estimates that if it did so, a Protab alone would sell for $.60. Required: 1. How many performance obligations are included in a Protab Package? Explain your answer.

Creative Computing sells a tablet computer called the Protab. The $780 sales price of a Protab Package includes the following: .One Protab computer. • A six-month limited warranty. This warranty guarantees that Creative will cover any costs that arise due to repairs or replacements associated with defective products for up to six months. • A coupon to purchase a Creative Probook ebook reader for $200, a price that represents a 50% discount from the regular Probook price of $400. It is expected that 20% of the discount coupons will be utilized. . A coupon to purchase a one-year extended warranty for $50. Customers can buy the extended warranty for $50 at other times as well. Creative estimates that 40% of customers will purchase an extended warranty. . Creative does not sell the Protab without the limited warranty, option to purchase a Probook, and the option to purchase an extended warranty, but estimates that if it did so, a Protab alone would sell for $.60. Required: 1. How many performance obligations are included in a Protab Package? Explain your answer.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Creative Computing sells a tablet computer called the Protab. The $780 sales price of a Protab Package includes the following: One Protab computer. A 6-month limited warranty. This warranty guarantees that Creative will cover any costs that arise due to repairs or replacements associated with defective products for up to six months. A coupon to purchase a Creative Probook e-book reader for $450, a price that represents a 40% discount from the regular Probook price of $750. It is expected that 20% of the discount coupons will be utilized. A coupon to purchase a one-year extended warranty for $65. Customers can buy the extended warranty for $110 at other times if they do not use the $65 coupon. Creative estimates that 30% of customers will purchase an extended warranty. Creative does not sell the Protab without the limited warranty, option to purchase a Probook, and the option to purchase an extended warranty, but estimates that if it did so, a Protab alone would sell for $760. Required:…
Creative Computing sells a tablet computer called the Protab. The $780 sales price of a Protab Package includes the following: One Protab computer. A 6-month limited warranty. This warranty guarantees that Creative will cover any costs that arise due to repairs or replacements associated with defective products for up to six months. A coupon to purchase a Creative Probook e-book reader for $450, a price that represents a 40% discount from the regular Probook price of $750. It is expected that 20% of the discount coupons will be utilized. A coupon to purchase a one-year extended warranty for $65. Customers can buy the extended warranty for $110 at other times if they do not use the $65 coupon. Creative estimates that 30% of customers will purchase an extended warranty. Creative does not sell the Protab without the limited warranty, option to purchase a Probook, and the option to purchase an extended warranty, but estimates that if it did so, a Protab alone would sell for $760.…
Creative Computing sells a tablet computer called the Protab. The $780 sales price of a Protab Package includesthe following:∙ One Protab computer.∙ A 6-month limited warranty. This warranty guarantees that Creative will cover any costs that arise due torepairs or replacements associated with defective products for up to six months.∙ A coupon to purchase a Creative Probook e-book reader for $200, a price that represents a 50% discount fromthe regular Probook price of $400. It is expected that 20% of the discount coupons will be utilized.∙ A coupon to purchase a one-year extended warranty for $50. Customers can buy the extended warranty for$50 at other times as well. Creative estimates that 40% of customers will purchase an extended warranty.∙ Creative does not sell the Protab without the limited warranty, option to purchase a Probook, and the optionto purchase an extended warranty, but estimates that if it did so, a Protab alone would sell for $760.Required:1. How many performance…
Serpent Home Depot carries wide variety of promotional techniques to attract customers. Kitchen and home appliances are sold in a one-year warranty for replacement of parts and labor. The estimated warranty cost, based on past experience is 5% of sales. The premium is offered on the home furniture. Customer receive a coupon for each peso spent on home furniture. Customers may exchange 2,000 coupons and P50 for a rice cooker which company purchased at P340 for each rice cooker and estimates that 60% of the coupons given to customers will be redeemed. The company’s total sales for 2016 were P115,200,000 – P86,400,000 from kitchen and home appliances and P28,800,000 from home furniture. Replacement parts and labor for warranty work totaled P2,624,000 during 2016. A total of 5,200 rice cookers used in the premium program were purchased during the year and there were 9,600,000 coupons redeemed in 2016. The accrual method is used by the company to account for the warranty and premium…
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?
A merchant sells a product on credit for S/ 50,000 and offers to pay it to a client in three bills of equal nominal value and with maturities at 45, 75 and 105 days respectively, applying on them an APR of 30% with bimonthly capitalization. If this merchant plans to discount the bills in a bank 15 days after the sale is made, being the effective discount rate 2% per month, find: 1. The face value of the bills.2. The net cash value received on discounting the bills.3. Calculate the discount.
A retailer owes a wholesaler $900,000 due in 45 days. If the payment is 15 days late, there is a 1% penalty charge. Since the bill isn't due immediately, the retailer can invest the $900,000 in a certificate of deposit and make money on the interest. The retailer has two options: a 45-day certificate of deposit (CD) earning 7% per year simple interest or a 60-day certificate earning 8% per year simple interest. How much interest would the retailer earn? Use 360 days in a year. (Round your answers to the nearest cent.) 45-day certificate $ 60-day certificate $ If the retailer opts for the 60-day certificate of deposit, he will be late on his payment to the wholesaler. How much will the penalty be if he is late on his payment to the wholesaler? $ How much will the retailer make in total if he opts for the 60-day certificate and has to pay the penalty out of the proceeds of the interest earned on the CD? (Round your answer to the nearest cent.) $ Is it better to take the 45-day…
An auto dealership is advertising that a new car with a sticker price of $34,128 is on sale for $25,995 if payment is made in full, or it can be financed at 0% interest for 72 months with a monthly payment of $474. Note that 72 payments x $474 per payment $34,128, which is the sticker price of the car. By allowing you to pay for the car in a series of payments (starting one month from now) rather than $25,995 now, the dealer is effectively loaning you $25,995. If you choose the 0% financing option, what is the effective interest rate that the auto dealership is earning on your loan? (Hint: Discount the payments back to current dollars, and use Goal Seek to find the discount rate that makes the net present value of the payments $25,995.) Enter your answer as a percentage. If required, round your answer to one decimal digit. 9.42% Hide Feedback Incorrect
Cover Rugs is holding a 2-week carpet sale at Josh’s Club, a local warehouse store. Cover Rugs plans to sell carpets for $950 each. The company will purchase the carpets from a local distributor for $760 each, with the privilege of returning any unsold units for a full refund. Josh’s Club has offered Cover Rugs two payment alternatives for the use of space. ■ Option 1: A fixed payment of $7,410 for the sale period ■ Option 2: 10% of total revenues earned during the sale period Assume Cover Rugs will incur no other costs. Q1. Calculate the breakeven point in units for (a) Option 1 and (b) Option 2. Q2. At what level of revenues will Cover Rugs earn the same operating income under either option? a. For what range of unit sales will Cover Rugs prefer Option 1? b. For what range of unit sales will Cover Rugs prefer Option 2? Q3. Calculate the degree of operating leverage at sales of 65 units for the two rental options. 4. Briefly explain and interpret your answer to requirement 3.
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.)
Kumi Ltd permits its customers to pay with a credit card or to receive a percentage discount x for paying cash. For credit card purchases, the companyreceives 97% of the purchase price one-half month later. Determine the value of x that would make the two payment methods equivalentif the company’s annual rate of return is 14%.
An auto dealership is advertising that a new car with a sticker price of $33,768 is on sale for $25,995 if payment is made in full, or it can be financed at 0% interest for 72 months with a monthly payment of $469. Note that 72 payments × $469 per payment = $33,768, which is the sticker price of the car. By allowing you to pay for the car in a series of payments (starting one month from now) rather than $25,995 now, the dealer is effectively loaning you $25,995. If you choose the 0% financing option, what is the effective interest rate that the auto dealership is earning on your loan? (Hint: Discount the payments back to current dollars, and use Goal Seek to find the discount rate that makes the net present value of the payments = $25,995.)