Question: Creative Computing sells a tablet computer called the Protab. The $605 sales price of a Protab Package includes the following One Protab computer. A6-month limited
Creative Computing sells a tablet computer called the Protab. The $605 sales price of a Protab Package includes the following One Protab computer. A6-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 $375, a price that represents a 40 % discount from the regular Probooka price of $625. It is expected that 20 % of the discount coupons will be utilized. A coupon to purchase a one-year extended warranty for $55. Customers can buy the extended warranty for $80 at other times if they do not use the $55 coupon. Creative estimates that 30 % 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 $585 . Required: 1. & 2. Indicate below whether each item is a separate pertformance obligation and allocate the transaction price of 120,000 Protab Packages to the separate performance obligations in the contract 3. Prepare a journal entry to record sales of 120,000 Protab Packages. Complete this question by entering your answers in the tabs below. Req 3 Req 1 and 2
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