Question
Stalwart Inc., a merchandiser, is running a promotion where a customer receives Product A for free with the purchase of Product B for $150. The
Stalwart Inc., a merchandiser, is running a promotion where a customer receives Product A for free with the purchase of Product B for $150. The standalone selling price of Product B is $150. The standalone selling price of Product A must be estimated because Stalwart has never sold this product in the past because its based on new technology. Stalwart Inc. is aware of a competitor selling a product similar to Product A in the market for $30.
Allocate the transaction price to Product A and Product B, rounding your final answers to the nearest whole dollar. Allocated transaction prices are as follows:
a. Product A: 30 Product B: 120
b. Product A: 50 Product B: 100
c. Product A: 125 Product B: 25
d. Product A: 25 Product B: 125
e. Product A: 0 Product B: 150
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