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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Sep/Dec 17 Question 3 a
Dear tutor,
I think I have a descent understanding of Rev. fr. Contracts with Customers but I could not understand the basis for the calculations.
0.9m/4.1m x 3.6m?
Why divide the wind turbine + standalone maintenance service by standalone maintenance service and then x by combined contract price.
This really confuses me.
Please explain
Thank you
Hi,
The total price to be allocated is $3.6m to each of the turbine and warranty. We allocate it on the stand alone prices of $3.2m and $0.9m, which total $4.1m. Therefore 0.9/4.1 is allocated to the total price to be allocated of $3.6.
Thanks