eBook Videos Print Question 3 Partially correct Mark 3.68 out of 10.00 Flag question Identifying and Recording Customer Option for Additional Merchandise Pets Inc. launches a new advertising promotion where, for each purchase over $30, it offers a coupon for a 35% discount on a future purchase. There is a limit of one coupon per customer. Pets Inc. estimates that 28% of customers receiving the coupon will redeem the coupon on an average purchase of $24. Sales on the first day of the one-week promotional period totaled $400,000 resulting in 4,000 coupons distributed. Assume all sales were cash sales. Cost of sales is 45% of the selling price. a. Determine how many performance obligations are included in a sales transaction during the advertising promotion program. Assume that coupons readily available to the public online or in company fliers have a maximum discount of 20%. Two performance obligations b. Record the journal entry to record revenue in the first day of the promotion period using the relative percentages to allocate standalone selling prices. Note: Carry all decimals in calculations; round the final answer to the nearest dollar. Performance Obligations Merchandise Customer option-merchandise credit $ Transaction Price as Stated Standalone Selling Price Total Allocated Transaction Price (rounded) 400,000 $ 400,000 $ 0 17,472 x 0 0 % Cash Account Name $ 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. 400,000 $ Debit Credit 400,000 0 0 0 0 0x 180,000 0 0 180,000 417,472 $ 0