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Question - Easywrite Software Company shipped software to a customer on July 1, 2011. The arrangement with the customer also requires the company to provide technical support over the next 12 months and to ship an expected software upgrade on January 1, 2012. The total contract price is $243,000, and Easywrite estimates that the individual fair values of the components of the arrangement if sold separately would be:
Software $ 210,000
Technical support 30,000
Upgrade 30,000
Required: Determine the timing and amount of revenue recognition for the $243,000.
Software Date of Shipment, July,1, 2011 $-------
Technical support evenly 12 month of the agreement$--
Upgrade Date of shipment, January,1,2012 $---
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