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A company sells equipment and service contracts. When purchased separately, the equipment costs 5,844 and a 8-year service contract costs 4,113. When purchased together, there
A company sells equipment and service contracts. When purchased separately, the equipment costs 5,844 and a 8-year service contract costs 4,113. When purchased together, there is a discount of 69% on the cost if purchased separately. They always deliver equipment the day it is sold.
If the customer buys the service contract separately and pays for it upfront, how much deferred revenue does the firm record at the time of the sale?
Be sure to round up numbers to the nearest whole dollar. No decimals are used in the answer.
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