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Business, 13.03.2020 06:00 shadowsnake

Creative Computing sells a tablet computer called the Protab. The $780 sales price of an Protab Package includes the following: One Protab computer. A 6-month limited warranty. This warranty guarantees that Creative will cover any costs that arise due to repairs or replacements associated with defective products for up to six months. A coupon to purchase a Creative Probook e-book reader for $160, a price that represents a 50% discount from the regular Probook price of $320. It is expected that 25% of the discount coupons will be utilized. A coupon to purchase a one-year extended warranty for $50. Customers can buy the extended warranty for $50 at other times as well. Creative estimates that 40% of customers will purchase an extended warranty. Creative does not sell the Protab without the limited warranty, option to purchase a Probook, and the option to purchase an extended warranty, but estimates that if it did so, a Protab alone would sell for $760. All Protab sales are made in cash. Required: 1. & 2. Indicated below whether each item is a separate performance obligation and allocate the transaction price of 95,000 Protab Packages to the separate performance obligations in the contract. 3. Prepare a journal entry to record sales of 95,000 Protab Packages (ignore any sales of extended warranties).

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Creative Computing sells a tablet computer called the Protab. The $780 sales price of an Protab Pack...
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