Beaumont Company enters into a contract to provide a high quality diving-certification preparation package, including goggles, snorkels, air tanks, fins, a wetsuit, and 5 private lessons to get ready for diving certifications. The entire package sells for $2,500.
-Typically, if Beaumont were to sell the equipment only, it would ask for $2,000.
Required:
Assuming that the diving equipment and the certification lessons are separate performance obligations, estimate the stand-alone selling price of the lessons based on the residual approach.

Question

Quizplus · Accepted Answer

The Answer of Beaumont Company enters into a contract to provide a high quality diving-certification preparation package, including goggles, snorkels, air tanks, fins, a wetsuit, and 5 private lessons to get ready for diving certifications. The entire package sells for $2,500.
-Typically, if Beaumont were to sell the equipment only, it would ask for $2,000.
Required:
Assuming that the diving equipment and the certification lessons are separate performance obligations, estimate the stand-alone selling price of the lessons based on the residual approach.

Beaumont Company Enters into a Contract to Provide a High