Just lost on how they got these solution for the journal entries for Question B. Can you show me how they did it or show your working.

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1. Brennan Ltd provides a bundled service offering to Yang Ltd. It charges Yang Ltd

$38 000 for upfront advice and two ongoing services - on-call troubleshooting help and access to databases over a two year period. Yang Ltd pays the $38 000 upfront, on 1 July 2020.

Brennan Ltd determines that, if it were to charge a separate fee for each service if sold separately, the fee would be:

Upfront advice 5 700

On-call 13 300

Access to databases 21 000

Brennan Ltds end of reporting period is 30 June.

Required:

1. Assuming Brennan Ltd applies the fair value approach, calculate the allocated amount for each of the separate services.

	Fair value of each component if sold separately	Allocation of fair value to total consideration	Allocated amount
Upfront advice	5 700	5 700/40 000 x 38 000	5 415
On-call advice	13 300	13 300/40 000 x 38 000	12 635
Access to databases	21 000	21 000/40 000 x 38 000	19 950
Total	40 000		38 000

Question B

Prepare the journal entries to record this transaction in the books of Brennan Ltd at the inception of the agreement on 1 July 2020.

Dr Cash 38 000

Cr Revenue upfront advice 5 415

Cr Deferred revenue on call advice 12 635

Cr Deferred revenue access to databases 19 950

Prepare the journal entries to record this transaction in the books of Brennan Ltd for the year ended 30 June 2021. Show all workings.

Dr Deferred revenue on call advice 6 317.50

Dr Deferred revenue access to databases 9 975

Cr Revenue on call advice 6 317.50

Cr Revenue access to databases 9 975