Question: Hi, I need help with this assignment (below) and please explain how you calculated therelative fair value method step by step. Thank you. BigBoy Equipment

Hi, I need help with this assignment (below) and please explain how you calculated therelative fair value method step by step. Thank you.

BigBoy Equipment Inc. sells heavy-duty forklift trucks. Model 217A has a stand-alone price of $96,000. BigBoy offers to sell the 217A inclusive of a three-year service contract for $123,500.

Required: Prepare a journal entry to record the sale of one Model 217A forklift truck plus service contract for $123,500 assuming: (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 1. A comparable service contract is sold separately for $24,000. BigBoy uses the relative stand-alone value method for multiple deliverables. 2. The service contract has a variable stand-alone value ranging from $13,900 to $24,000 and BigBoy uses the residual value method.

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