Thermaline sells a restaurant, for a total price of 10,800, a professional coffee machine and a three-year extended warranty including quarterly preventive maintenance. After analysing the relevant factors, Thermaline concluded (conclusion given by the case) that the extension provides a service in addition to the assurance of compliance and is a performance obligation separate from the machine. The observed stand-alone selling prices are 10,000 for the machine and 2,000 for the extended warranty. Allocate the transaction price.
- Total contract price
- 10,800
- Stand-alone selling price of the machine
- 10,000
- Stand-alone selling price of the extended warranty
- 2,000