Vroom Vacuums sells the Tornado vacuum cleaner. Each Tornado has a one
year warranty that covers any product defects. When
customers purchase a Tornado, they also have the option to purchase an extended three
year warranty that covers any breakage or
maintenance. The extended warranty sells for the same amount regardless of whether it is purchased at the same time as the Tornado
or at some other time.
How many performance obligations exist in the implied contract for the purchase of a vacuum cleaner?
Number of performance obligations in the contract
Identify the best description of each performance obligation from the following list.
Note: You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct
answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark
will be automatically graded as incorrect.
Delivery of vacuum cleaner
The one
year quality
assurance warranty
The option to purchase the three
year extended warranty
Purchase of vacuum cleaner
