A large clothing retailer chain, Koll's, offers a sales incentive program where customers receive direct credit toward future purchases based upon the dollar amount of purchases today. For every $50 spent today, the customer will earn a $6 credit to be used at Koll's in two weeks. The credit expires 5 days after it becomes active. Not all customers will redeem the credit in the 5-day window of time. Based upon historical trends, Koll's estimates that 35% of the credits will be redeemed. a. Determine how many performance obligations are included in a sales transaction during the sales incentive program. One performance obligation x b. Assuming that Koll's sold $525,000 of merchandise (cost of $210,000) during the first day of the sales incentive period and 10,500, $6 credits were given, record the journal entry(ies) to record sales revenue. Assume all sales were cash sales. Note: Carry all decimals in calculations; round the final answer to the nearest dollar. Performance Obligations Merchandise Customer option-merchandise credit Account Name Transaction Price as Stated Standalone Selling Price $ 525,000 $ 525,000 22,050 $ 525,000 $ 547,050 $ Cash Sales Revenue Deferred Revenue-Merchandise Credit To record the sale of merchandise Cost of Goods Sold Inventory To record the cost of sale of merchandise Debit Credit 525,000 0 503,838.77 x 21,161.23 x 210,000 0 0 210,000 Total Allocated Transaction Price (rounded) 503,838.77 21,161.23 525,000 c. Record a summary entry to recognize revenue (if any) during the 5-day merchandise credit redemption period, assuming that 35% of the credits are redeemed. Account Name Contract Asset Sales Revenue To receognize revenue. Debit Credit 0 0 0x 0x d. Record a summary entry to recognize revenue (if any) at the conclusion of the 5-day merchandise credit redemption period, assuming that no credits are redeemed. Contract Asset Account Name Inventory To receognize revenue. Debit Credit (21,161.23) 0x 0 22,050 x