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Musya8 [376]
2 years ago
9

Ayayai inc. Has a customer loyalty program that rewards a customer with 1 customer loyalty point for every $10 of purchase. Each

point is redeemable for $3 discount on any future purchases . On july 2, 2020 customers purchase pro for $370000 (with a cost of $210900 )and earn 37000 points redeemable for future purchases. Ayayai is expected 31500 points to be redeemed. Ayayai estimates a standalone selling price for $2.50 per point (or $92500 total ) on the basis of the likelihood of redemption . The points provide a material right to customers that they would not receive without entering into a contract. As a result. Ayayai concludes that the points are separate performance obligation. Determine the transaction price for the product and the customer loyalty points. Product purchases, loyalty points, total transaction price
Mathematics
1 answer:
RUDIKE [14]2 years ago
3 0

The transaction price for Ayayai's product and the customer loyalty points are $92500 and 37000 points respectively.

<h3>How to determine the transaction price?</h3>

Based on the information provided about Ayayai inc., the transaction price for their product and the customer loyalty points would be allocated as follows:

<u>                                             SSP            PA              TTP                    AA____</u>

Product purchases       $370,000       80%         $370,000         $296,000

Loyalty points               <u>$92,500* </u>       20%         $370,000         <u>$74,000__</u>

                                      <u>$462,500</u>                                                 <u>$370,000</u>

*37,000 × 2.50 = $92,500

<u>Note:</u>

  • SSP means Standalone selling prices.
  • PA means Percent allocated.
  • TTP means Total transaction price.
  • AA means Allocated amounts.

Read more on transaction price here: brainly.com/question/15874481

#SPJ1

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