Denim, Inc. entered into a contract to sell equipment to Levi LLC. on October 1, 2021. Along with the equipment, Denim Inc. will provide one-year maintenance services on an as-needed basis, beginning once the equipment is installed. Denim offers similar services to other customers that purchased equipment sold by other vendors for $20,000. Denim Inc. will also provide installation services at no additional cost, a service that Denim Inc. typically charges $10,000. The equipment normally sells for $170,000 on its own. For the package deal, Levi LLC. agrees to pay a total of $180,000. The equipment was delivered and installed on November 1, 2021. Levi LLC. paid the entire invoice in cash on the delivery and installation date. How much revenue should Denim Inc. allocate to the various performance obligations in the above contract (round to the nearest dollar, if needed)?
Denim, Inc. entered into a contract to sell equipment to Levi LLC. on October 1, 2021. Along with the equipment, Denim Inc. will provide one-year maintenance services on an as-needed basis, beginning once the equipment is installed. Denim offers similar services to other customers that purchased equipment sold by other vendors for $20,000. Denim Inc. will also provide installation services at no additional cost, a service that Denim Inc. typically charges $10,000. The equipment normally sells for $170,000 on its own. For the package deal, Levi LLC. agrees to pay a total of $180,000. The equipment was delivered and installed on November 1, 2021. Levi LLC. paid the entire invoice in cash on the delivery and installation date. How much revenue should Denim Inc. allocate to the various performance obligations in the above contract (round to the nearest dollar, if needed)?
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