Question

The Gamebox system normally sells for $250 and comes pre-packaged with one game. The average price for games is $30. The company also sells its online game subscription package, which allows members to download and play one new game per month, for $240. During the holiday season, the company provides a package deal which includes the gaming system with two games and a free one-year game subscription for $400. The company should allocate $192.31of the $400 package purchase price to the gaming system.

A. True
B. False

Answer 1

The answer is "Option A"

Step-by-step explanation:

The given statement is true because it uses the transaction price method. In this process, the amount of evaluation for the company entity continues to earn for the client to convert products or services.

Its quantity may also be fixed, changeable, or coupled, and the price of the payment shall be allocated to its fair value recognized throughout the contract, that's why in this question two gaming system includes with a 1-year free subscription in $400, and the organizations should make the gaming system $192.31 of a $400 bundle sales price.