Kieso, Intermediate Accounting, 16e Help System Announcements CALCULATOR PRINTER VERSION BACK NEXI Exercise 18-13 (Part Level Submission) Sarasota Company manufactures equipment. Sarasota's products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $200,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Sarasota has the following arrangement with Winkerbean Inc. Winkerbean purchases equipment from Sarasota for a price of $1,100,000 and contracts with Sarasota to install the equipment. Sarasota charges the same price for the equipment irrespective of whether it does the installation or not. Using market data, Sarasota determines Installation service is estimated to have a standalone selling price of $50,000. The cost of the equipment is $630,000. Winkerbean is obligated to pay Sarasota the $1,100,000 upon the delivery and installation of the equipment. Sarasota delivers the equipment on June 1, 2017, and completes the installation of the equipment on September 30, 2017. The equipment has a useful Wife of 10 years Assume that the equipment and the installation are two distinct performance obligations which should be accounted for separately. v (2) Your answer is correct. How should the transaction price of $1,100,000 be allocated among the service obligations? (Do not round intermediate calculations. Round inal answers to o decimal places.) Equipment 1,052,174 Installation 47,826 Click if you would like to Show Work for this question: Open Show Work e to search Tu, Teluidte Accounting, 16e Help System Announcements Service Revenue CALCULATOR PRINT (To record sales) Cost of Goods Sold 600000 Inventory 600000 (To record cost of goods sold) Sep. 30, 2017 Service Revenue (To record service revenue) Cash Installment Accounts Receivable (To record payment received) Click if you would like to Show Work for this question: Open Show Work SHOW LIST OF ACCOUNTS SHOW SOLUTION LINK TO TEXT LINK TO TEXT e to search