How much of the $475 sales price should be allocated

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Question: In May 2024, Paucek Tire Company had a customer pay $475 for a new set of tires with rotating and balancing services for the life of the tires. Paucek gave the customer a coupon for $50 off a future purchase. Paucek estimates that approximately 70% of customers will use the coupon. If sold separately, the tires would sell for $400 and the rotating and balancing services would have cost $120. How much of the $475 sales price should be allocated to the tires, the rotating and balancing services and the coupon?

Reference no: EM133654952

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