Questions 1-3 are all about the same contract; follow the instructions regarding the information to use for each question.

For question 1, use just the information in this question.

Fizz Inc. sells round-the-clock access to its online platform, allowing users to communicate with each other and to play games. In addition, Fizz sells other software products that enhance a computer users security and ability to shop for technology-related products online.

Fizz sells each of these items independently for the following prices:

Round-the-clock access to the platform: $20 for a year's access;

Security enhancement, downloaded on the contract start date, $10; and

Tech shopping enhancement, downloaded on the contract start date, $5.

A customer ordered the bundle of the items listed above, and paid $30 for the bundle on 10/1/2021. Fizz information suggests that the price discount for the bundle applies only to the round-the-clock access and tech shopping enhancement in proportion to their selling prices. State the number of performance obligations in the sales contract and briefly explain your answer (how you found the number of performance obligations).

Question 2

Using the information from question 1, allocate the $30 contract price to each performance obligation you listed in question 1 under the contract. Show your work.

Question 3

For this question, use the information from questions 1 and 2 and the following information. Fizz and the customer start the contract on 10/1/2021, and Fizz collects the $30 price on this date. Fizz delivers the products according to the contract. Make all of Fizz's entries for 2021 under the contract (any entries Fizz would make in October, November, and/or December). Show your work. (You do not need to make any entries to close the income statement accounts to retained earnings.)