Exercise 6-3 (Algo) Allocating transaction price [LO6-4] 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 $2,000, sells the remote separately for $125, and offers the installation service separately for $375. The entire package sells for $2,400. 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 TV Remote Installation Total revenue $ 0

Exercise 6-3 (Algo) Allocating transaction price [LO6-4] 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 $2,000, sells the remote separately for $125, and offers the installation service separately for $375. The entire package sells for $2,400. 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 TV Remote Installation Total revenue $ 0

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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rtainment 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 Winterface with other parts of the customer's home staff The installation includes programming the remote to have t system VP concludes that the TV, remote, and installation service are separate performance obligations VP sells the 60-inch TV the package for $2.300 VP does not sell the separately for $1.950 and sells the remote separately for $200, the installation service VP also estimates that installation service separately Vis aware that other similar provide the installation service. VP typically charges 30% ncurs approximately $200 of compensation and other costs t 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 Adued market assessment Expected cost plus margin Residual 1,900
Exercise 6-3 (Algo) Allocating transaction price [LO6-4] 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 $2,000, sells the remote separately for $125, and offers the installation service separately for $375. The entire package sells for $2,400. Required: How much revenue would be allocated to the TV, the remote, and the installation service? Note: Do not round intermediate calculations. Item Description TV Remote Installation Total revenue Allocated Revenue
Check Exercise 6-15 (Algo) Approaches for estimating stand-alone selling prices (LO6-6) 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 $2,110 and sells the remote separately for $280, and offers the entire package for $2,620. VP does not sell the installation service separately. VP is aware that other similar vendors charge $330 for the installation service. VP also estimates that it incurs approximately $280 of compensation and other costs for VP staff to provide the installation service. VP typically charges 40% above cost on similar sales. ok ht nt Required: 1. to 3. Calculate the stand-alone selling price of the…
Exercise 6-15 (Algo) Approaches for estimating stand-alone selling prices [LO6-6] 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 $1,790, sells the remote separately for $120, and offers the entire package for $1,980. VP does not sell the installation service separately. VP is aware that other similar vendors charge $170 for the installation service. VP also estimates that it incurs approximately $120 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. Estimate the stand-alone selling price of the installation service using…
II - Single Performance Obligation - Polnt in Time vs. Over Time Anton Video Tech sells the Play Station Portable (PSP) game-box, a gaming console. A PSP game-box is only a gaming module and includes no other goods or services. When should Anton recognize revenue for the following sale of 200 PSP games-boxes to Robcom Computers? • December 20, 20x6: Robcom Computers orders 200 games-boxes at a price of P7,600 each, promising payment within thirty (30) days after delivery. • January 1, 20x7: Anton delivers 200 PSP game-boxes to Robcom Computers, and title to the PSP game-boxes transfers to Robcom Computers. • January 25, 20x7: Anton receives P1,520,000 from Robcom. Required: 1. Prepare the journal entryfies) on December 20, 20x7. 2. Prepare the journal entry(ies) on January 1, 20x7. 3. Prepare the journal entry(ies) on January 25, 20x7. 4. Determine the amount of revenue from sales on December 20, 20x7. 5. Determine the amount of revenue from sales on January 1, 20x8. 6. Determine the…
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?
Question 5-price allocation Red Windows manufactures and sells custom storm windows for enclosed porches. Red also- provides installation service for the windows. The installation process does notinvolve changes in the windows, so this service can be provided by other vendors. Red enters into the following contract on 15 Jun 2020, with alocal homeowner. The customer purchases windows for a price of £7,500 and chooses Red to do the installation. Red 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 £1,000. The customer pays Red £6,000 (which equals the fair value of the windows, which have a cost of £4,300) upon delivery and the remaining balance upon installation of the windows. The windows are delivered on 15 Jul 2020, Red completes installation on 4 Aug 2020, and the customer pays the balance due. e Required Prepare the journal entries for Red on all the dates…
Problem 18-01 (Part Level Submission) Waterway 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. Waterway Bundle A sells a tablet with 3 years of Internet service. The price for the tablet and a 3-year Internet connection service contract is $505. The standalone selling price of the tablet is $263 (the cost to Waterway Company is $160). Waterway Company sells the Internet access service independently for an upfront payment of $296. On January 2, 2020, Waterway Company signed 100 contracts, receiving a total of $50,500 in cash. 2. Waterway 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 $607. Waterway Company provides the 3-year tablet service plan as a…
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…
Required Information [The following information applies to the questions displayed below] Watko Entertainment Systems (WES) buys audio and video components for assembling home entertainment systems from two suppliers, Bacon Electronics and Hessel Audio and Video. The components are delivered in cartons. If the cartons are delivered late, the installation for the customer is delayed. Delayed Installations lead to contractual penalties that call for WES to reimburse a portion of the purchase price to the customer. During the past quarter, the purchasing and delivery data for the two suppliers showed the following: Total purchases (cartons) Average purchase price (per carton) Number of deliveries Percentage of cartons delivered late. Bacon Hessel Answer is complete but not entirely correct. Effective Cost Per Carton Bacon 5,000 $ 176 40 30% S S Hessel 3,000 $192 The Accounting Department recorded $249,600 as the cost of late deliverles to customers. 228.80 220.80 x 20 15% Required: Assume…
Please no written by hand solutions Shamrock 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. Shamrock Bundle A sells a tablet with 3 years of Internet service. The price for the tablet and a 3-year Internet connection service contract is $464. The standalone selling price of the tablet is $229 (the cost to Shamrock Company is $172). Shamrock Company sells the Internet access service independently for an upfront payment of $290. On January 2, 2017, Shamrock Company signed 100 contracts, receiving a total of $46,400 in cash. 2. Shamrock 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 $563. Shamrock Company provides the 3-year tablet service plan as a separate…
Question 3: Each of the following situations is independent. A. Vallis Inc. manufactures machine parts for military an offer from another military subcontractor to provide 2.000 units of product ZR17 for $120,000. If Vallis does not purchase these parts fi continue to produce them in-house at the following drones. The company is considering 'om the subcontractor, it must costs: Cosf per Unit $28 $18 $16 $4 Direct materials Direct labour Variable overhead Allocated fixed overhead Required: a. Analyze the offer quantitatively to determine if Vallis should continue to manufacture the component or outsource it. b. Outline at least three qualitative considerations that Vallis should consider in this decision. Why are these factors that you have outlined important?