1. A software company licensed software to manufacturing firm for 5 years. In ad
ID: 2467815 • Letter: 1
Question
1. A software company licensed software to manufacturing firm for 5 years. In addition to providing the software, the company also provides consulting services and support to ensure smooth operation of the software. The total transaction price is $350,000. Based on standalone values, the company estimates the consulting services and support have a value of $100,000 and the software license has a value of $250,000. Assume that the performance obligations are not interdependent.
Using the T-account , prepare the journal entry to record the transaction.
Explanation / Answer
solution :
CASH
350000
SALES REVENUE
250000
UNEARNED SERVICE REVENUE
100000
CASH
350000
SALES REVENUE
250000
UNEARNED SERVICE REVENUE
100000
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.