2. Too Nice Company (TNC) includes with the sale of its jumping bean machine, a 5-year warranty that covers all repairs and maintenance. The selling price for the jumping bean machine and the related warranty is $2,000. A competitor sells a similar machine without any warranty for $1,850. TNC does not sell the warranty separately nor is it aware of any company that does. TNC estimates it will cost $240 to perform warranty work on each jumping bean machine over the 5-year warranty period. TNC's average markup on sales is 40%. In 2020, TNC sells 1,200 jumping bean machines, and incurs $42,000 total warranty cost on the 1,200 machines. a. How many performance obligations are involved in the jumping bean machine sales in 2020? Justify your answer. b. What is the transaction price? c. Determine the transaction price allocated to each performance obligations. d. How much revenue will be recognized from the above transaction in 2020? 3. On January 1 What's the Revenue (WTR) Company enters into a 6 month contract to provide unlimited consulting services related to a customer's computer system. The customer agrees to pay $200 per hour for the services up to a maximum of $200,000. In January and February WTR performs 120 and 200 hours of service, respectively, and believes it is highly unlikely that the overall contract work will exceed 1,000 hours. During March, WTR discovered a significant error in the customer's computer code related to the engagement, resulting in 350 hours of work during March. Based on this, WTR believes that the entire engagement will likely entail a total of 1,100 hours. a. How much revenue will be recognized in January on this consulting engagement? b. How much revenue will be recognized in February on this consulting engagement? c. How much revenue will be recognized in March on this consulting engagement? 2. Too Nice Company (TNC) includes with the sale of its jumping bean machine, a 5-year warranty that covers all repairs and maintenance. The selling price for the jumping bean machine and the related warranty is $2,000. A competitor sells a similar machine without any warranty for $1,850. TNC does not sell the warranty separately nor is it aware of any company that does. TNC estimates it will cost $240 to perform warranty work on each jumping bean machine over the 5-year warranty period. TNC's average markup on sales is 40%. In 2020, TNC sells 1,200 jumping bean machines, and incurs $42,000 total warranty cost on the 1,200 machines. a. How many performance obligations are involved in the jumping bean machine sales in 2020? Justify your answer. b. What is the transaction price? c. Determine the transaction price allocated to each performance obligations. d. How much revenue will be recognized from the above transaction in 2020