On January 1, 2017, Loud Company enters into a 2-year contract with a customer for an unlimited talk and 5 GB data wireless plan for $65 per month. The contract includes a smartphone for which the customer pays $299. Loud also sells the smartphone and monthly service plan separately, charging $649 for the smartphone and $65 for the monthly service for the unlimited talk and 5 GB data wireless plan.

Required:

1.	Calculate the transaction price for the smartphone and unlimited talk and 5 GB data wireless plan assuming that Loud allocates consideration based on stand-alone prices.
2.	Record the initial journal entry for Loud Companys sale of a 2-year contract on January 1, 2017, and the monthly journal entry.

Calculate the transaction price for the smartphone and unlimited talk and 5 GB data wireless plan assuming that Loud allocates consideration based on stand-alone prices. Additional Instruction

	Initial	Stand-Alone	Allocated
	Consideration	Selling Price	Transaction Price
Smartphone
5 GB plan
Total consideration

Additional Instruction

Allocate using two one-hundreds of a percent. For example: $649 / $2,209 = 29.38% and round your answers to the nearest cent.