Far Horizons, Inc. sells mobile phones, wireless plans, and service plan packages. Far Horizons packages the following items for sale.

Far Horizons has determined that each item is a separate performance obligation. A customer purchases a new phone package on September 1. Explain how and when revenue is recognized. Prepare the journal entries for the month of September, assuming Far Horizons makes adjusting entries on September 30.

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Package Amount $199.00 40.00 24.00 $263.00 Description Phone Wireless Plan per month Service Plan per month Total When Purchased Paid when customer purchases the phone. unlimited calling. Minimuกา coverage of 12-months. Paid monthly. 12-month coverage. Paid when customer purchases the phone.