TelCo provides a bundle service offering to a customer for 3,000 upfront. The services provided are as follows:

i) Upfront advice

ii) On-call advice for a 1-year period

iii) Database access for a 2-year period

If TelCo were to charge a separate fee for each service if sold separately the fee would be:

- Upfront advice 200

- On-call advice 2,600

- Database access 800

What is the amount of revenue recognised in relation to the on-call advice one year after contract inception?

Question 6Answer

a.

1,000

b.

indeterminable based on the facts provided

c.

2,600

d.

2,167