1) Matterson Dental Company enters into a contract to provide New-Dentist, Inc. with equipment (fair market value of $655,000) and supplies ($110,000) on January 2, 2023. In exchange, New-Dentist will pay Matterson $100,000 on January 2 and $100,000 every 3 months for the next 2 years, beginning April 2, 2023 and ending October 2, 2025. The appropriate rate to discount cash flows is 8%. What is the total contract price for the purpose of revenue recognition?

2) Matterson Dental Company enters into a contract to provide New-Dentist, Inc. with equipment (fair market value of $750,000) and supplies ($200,000) on January 2, 2023. The contract calls for a downpayment for the supplies, seven quarterly payments, and an interest rate of 8%.

When discounted to present value, the contract price is $910,000. The supplies and the equipment are considered two separate performance obligations.

What amount of revenue should Matterson record for a) the equipment and what amount for b) the supplies, when the obligations are met?