On September 1, 2019, you entered into a 36-month Unlimited & More phone plan with T-Mobile, which
Question:
On September 1, 2019, you entered into a 36-month Unlimited & More phone plan with T-Mobile, which is a goods and services tax-registered company with a December 31 financial year-end. The terms of the plan are as follows:
(1) Monthly fixed fee: $41.60 (to be billed monthly)
(2) Free iPad at the inception of the plan
(3) T-Mobile sells the same iPad for $156 and the same monthly plans without iPad for $38.48 per month.
(4) All amounts stated are inclusive of 4% tax.
Under ASC 606, how much T-Mobile should recognize revenue for the September 1, 2019 contract at the end of fiscal-year end in 2019? Round all amounts, including a percentage to the nearest tenths.
A. $253.3
B. $270.0
C. $316.4
D. $0
E. $156.0
F. $280.8
G. $322.4
H. $257.9
I. $290.0
J. $256.4
K. $289.2
L. $150.0
M. $261
N. $450.0
O. $280.0
Intermediate Accounting IFRS
ISBN: 978-1119372936
3rd edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield