Revenue Recognition: Allocation of Transaction Price Boats-R-Us regularly sells custom sailboats at a quoted selling price of $19,800 each (standalone price). To sweeten each boat sale, Boat-R- Us offers the buyer a top-quality canoe to take along with the boat. In addition, Boats-R-Us offers to recalibrate the boat's engine only once after six months of purchase. The calibration process does not involve changes to the boat, so this service can be performed by any other vendors. Boats-R-Us enters into the following contract on September 1, 2020, with an avid sailor. The sailor purchases a sailboat for a price of $18,000, accepts the canoe offer, and chooses Boats-R-Us to do the calibration. Boats-R-Us charges the same price for the sailboat irrespective of whether or not the customer accepts the canoe and the calibration service. The calibration service and the canoe EACH is estimated to have a standalone selling price or $1,400. The customer pays Boats-R-Us $18,000 cash upon delivery of the sailboat and the cance on September 10, 2020. Boats-R-Us completed the calibration service on February 4, 2021. Required: How many specific performance obligations are in the contract with the sailor? 2 On what date was the very earlist performance obligation completed? Write your answer in this format 3/3/2020 If your answer in #1 is more than one performance obligation, indicate the date when the last performance obligation was completed. Write your answer in this format 3/3/2020 How much is the transaction price for this contract? Do not enter your answer with $ signs or commas just the raw number # If your answer in #1 is more than one performance obligation, how much of the transaction price is allocated to the sale of the boat? Round off the answer to the nearest whole digit (no decimals) and do not enter your answer with S signs or commas - just the raw number, Revenue Recognition: Allocation of Transaction Price Boats-R-Us regularly sells custom sailboats at a quoted selling price of $19,800 each (standalone price). To sweeten each boat sale, Boat-R- Us offers the buyer a top-quality canoe to take along with the boat. In addition, Boats-R-Us offers to recalibrate the boat's engine only once after six months of purchase. The calibration process does not involve changes to the boat, so this service can be performed by any other vendors. Boats-R-Us enters into the following contract on September 1, 2020, with an avid sailor. The sailor purchases a sailboat for a price of $18,000, accepts the canoe offer, and chooses Boats-R-Us to do the calibration. Boats-R-Us charges the same price for the sailboat irrespective of whether or not the customer accepts the canoe and the calibration service. The calibration service and the canoe EACH is estimated to have a standalone selling price or $1,400. The customer pays Boats-R-Us $18,000 cash upon delivery of the sailboat and the cance on September 10, 2020. Boats-R-Us completed the calibration service on February 4, 2021. Required: How many specific performance obligations are in the contract with the sailor? 2 On what date was the very earlist performance obligation completed? Write your answer in this format 3/3/2020 If your answer in #1 is more than one performance obligation, indicate the date when the last performance obligation was completed. Write your answer in this format 3/3/2020 How much is the transaction price for this contract? Do not enter your answer with $ signs or commas just the raw number # If your answer in #1 is more than one performance obligation, how much of the transaction price is allocated to the sale of the boat? Round off the answer to the nearest whole digit (no decimals) and do not enter your answer with S signs or commas - just the raw number
