1. TechGate has signed a new two-year contract with a customer providing access to TechGates cloud-based software engineering tool. TechGate operates on an accrual basis and will invoice the customer $12,000 for full amount of the first-year subscription on 1/1/22. The first year of the agreement runs from 1/1/22 to 12/31/22. At the end of January 2022, how much revenue should TechGate recognize from the agreement?

a).$12,000

b).$2,500

c).$0

d).$1,000

2. Arbitrary Inc has a fixed asset threshold of $2,500 per item. They purchase 5 computers for $10,000. How should that purchase be treated?

a). Add 5 computers to the fixed asset account for $2,000 each and depreciate over their life

b).Add 4 computers to the fixed asset account for $2,500 each and depreciate over the estimated life

c).Add 1 item to the fixed asset for $10,000 and depreciate over the estimated life

d).Fully expensed at the time of the purchase