Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On January 1 , Year 1 , Loud Company enters into a 2 - year contract with a customer for an unlimited talk and 5

On January 1, Year 1, Loud Company enters into a 2-year contract with a customer for an unlimited talk and 5 GB data wireless plan for $64.00 per month. The contract includes a smart phone for which the customer pays $299.00. Loud also sells the smart phone and monthly service plan separately, charging $649.00 for the smart phone and $64.00 for the monthly service for the unlimited talk and 5 GB data wireless plan. On July 1, Year 1, the customer realizes that she needs less data in her wireless plan and downgrades to the unlimited talk and 2 GB data plan for the remaining term of the contract (18 months). The unlimited talk and 2 GB data plan is priced at $45.00 per month. The $45.00 per month is Louds current stand-alone price for this plan that is available to all customers. Loud has appropriately determined that the modification should be accounted for prospectively. Questions:
1) On July 1, the contract receivable has a remaining balance of __?___.
2) As a result (of Question 1), the entity has
__?__ to allocate to the remaining 18 months of service, or __?__
per month.
***please help me with correct amounts for Question 1 and 2. There are 3 blanks that need to be filled

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Bookkeepers Boot Camp Get A Grip On Accounting Basics

Authors: Angie Mohr

3rd Edition

1770402527, 978-1770402522

More Books

Students also viewed these Accounting questions