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CharterX Inc. establishes a contract with a customer to deliver both a cable television receiver...

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Accounting

CharterX Inc. establishes a contract with a customer to deliver both a cable television receiver (equipment) and cable television service for 15 months. In exchange, the customer pays a $150 upfront fee for installation of the cable television receiver (which must be returned to CharterX Inc. at the end of the contract term) and pays $160 a month for the premium package of 200+ channels. The $150 upfront fee has no standalone selling price as it is not sold separately. The $160 charge per month for cable services is at its standalone selling price. The company has determined that the contract for the receiver is not a lease.
a.(1) How many performance obligations are established in the revenue contract?
(2) Record the entry by the seller at the initiation of the contract assuming 100 contracts are initiated.
(3) Record the entry by the seller one month after initiation of the contract.

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