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A company sells equipment and service contracts.When purchased separately, the equipment costs 7,943, and a 6 year service contract costs 6,029.When purchased together, the equipment
A company sells equipment and service contracts.When purchased separately, the equipment costs 7,943, and a 6 year service contract costs 6,029.When purchased together, the equipment cost is discounted to 78 percent of the cost if purchased separately. They always deliver equipment the day it is sold.
If the customer buys the equipment together with a service contract and pays for it up front, how much deferred revenue does the firm record at the time of the sale?
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