O'Hara Associates sells golf clubs and with each sale of a full set of clubs provides complementary
Question:
O'Hara Associates sells golf clubs and with each sale of a full set of clubs provides complementary club-fitting services. A full set of clubs with the fitting services sells for $1,500. O'Hara estimates that it incurs $60 of staff compensation and other costs to provide the fitting services, and normally earns 30% over cost on similar services. Assuming that the golf clubs and the club fitting services are separate performance obligations, estimate the stand-alone selling price of the club-fitting services using the expected cost plus margin approach.
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Under the expected cost plus margin approach OHara would base it...View the full answer
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