Clarks Inc., a shoe retailer, sells boots in different styles. In early November the company starts selling SunBoots to customers for $65 per pair. When a customer purchases a pair of SunBoots, Clarks also gives the customer a 30% discount coupon for any additional future purchases made in the next 30 days. Customers cant obtain the discount coupon otherwise. Clarks anticipates that approximately 20% of customers will utilize the coupon, and that on average those customers will purchase additional goods that normally sell for $120.

Required:

1.

How many performance obligations are in a contract to buy a pair of SunBoots?

Number of performance obligations

2.

Prepare a journal entry to record revenue for the sale of 1,000 pairs of SunBoots, assuming that Clarks uses the residual method to estimate the stand-alone selling price of SunBoots sold without the discount coupon. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Record the revenue for the sale of 1,000 pairs of SunBoots.