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How much revenue does the firm recognize

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Reference no: EM132751991

Question - IBM sells equipment and service contracts. When purchased separately, the equipment costs 6,001, and a 7 year service contract costs 4,410. When purchased together, the equipment cost is discounted to 13% of the cost if purchased separately. They always deliver equipment the day it is sold. How much revenue does the firm recognize during the first year of the service contract when it is sold separately?

Reference no: EM132751991

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