Question

ent A franchise of automotive technidans has a contract arrangement for a rewards program with a car manufacturing company and C Por every $4.00 Vis prored by technidan at anyone of the franchise locations, the customer is warded Car Dollar The Car Dolans can be redeemed towards the purchase of a motor vehide manufactured by BMC to the automotive technicians performed $20,200,000 worth of services in 2020. BMC have estimated the stand-alone selling price of $0.35 and for each Car Delar awarded, the automotive technicians will pay $0.30 to the BMC for each Car Dollar awarded to its customers. Your answer is correct. Determine how the $20,200,000 transaction price would be allocated to the two performance obligations (the automotive Mervices and the Car Dola percentage of total selling price calculations to 1 decimal place 15 and final answers to decimal places, p. 125.) med by the home 18574712.6 Automotive Services 16252874 Car Dollars SHOW LIST OF ACCOUNTS SHOW SOLUTION Attempts 2 of 2 used Determine the amount of the commission revenue to be reported by the franchises in 2020.

pls find comission revenue

Answer 1

Total service performed by automotive technician = $ 20,200,000

Car dollars awarded for each $4 billed = $20,200,000 / $4 = 50,50,000 car dollars

Stand alone selling price for each car dollars = $0.35

Value given to BHC by automotive technician = $0.30

So commission per car dollars = $0.35 - $0.30 = $0.05

Total commission = 50,50,000 * 0.05 = $2,52,500