Creative Computing sells a tablet computer callled the Protab. The $890 sales pr

Question

Creative Computing sells a tablet computer callled the Protab. The $890 sales price of a Protab Package includes the 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 A coupon to purchase a Creative Probook e-book reader for $145, a price that represents a 50% discount from the regular Probook price of $290. It is expected that 25% 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 $65 at other times as well. Creative estimates that 35% 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 $870 1 Indicated below whether each item is a separate performance obligation and allocate the transaction price of 96,000 Protab Packages to the separate performance obligations in the contract 3 Prepare a journall entry to record sales of 96,000 Protab Packages (ignore any sales of extended warranties). (If no entry is required for a transactionlevent, select "No journal entry required" in the first account field) ournal entry worksheet Record sales of%, Protab Packages.

Explanation / Answer

1. Allocation of transaction price of 96000 protab packages:

2. Journal Entry for Sale of Protab Packages:

Item Description Performance Obligation Stand Alone Price Percentage of Total Standalone Price Protab Computers 96000 870 71.02% Limited 6-month warranty 96000 0 0.00% Probook Account vouchers 96000*0.25 =24000 290 23.67% option to purchase extended warranty 96000*0.35=33600 65 5.31% Total standalone price 1225

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.