The Rink offers $300 annual memberships that entitle members to unlimited use of the ice skating facilities and locker rooms. Each new membership also entitles the member to receive ten "30% off a $5 meal" coupons that can be redeemed at Rink's snack bar. The Rink estimates that approximately 80% of the coupons will be redeemed and if the coupons were not redeemed, $5 meals would still be 5% off due to ongoing promotions.

Required:

Calculate how much of the transaction price should be allocated to each performance obligation in the contract.

Answer rating: 100% (QA)

The contract includes two performance obligations 1 Unlimited use of the ice skating facilities and locker rooms 2 Ten 30 off a 5 meal coupons To allocate the transaction price between these two perfo... View the full answer