Software Supplier Inc. sells to a customer a perpetual software license and post-contract customer support for a

12-month period, commencing at the time that the software is activated. Software Supplier Inc. charges $300 upfront

when the software is purchased and $20 a month for 12 months, due at the end of the month. Software Supplier Inc.

sells the software separately for $400 while the standalone selling price of the post-contract customer support is $200.

a. How should the transaction price be allocated among the performance obligation(s)? Round to the nearest

dollar.

b. Prepare Software Suppliers journal entry to record sale of software to the customer and the entry for the first

monthly payment