A /New York daily newspaper called "Manhattan Today" charges an annual subscription fee of $108. Customers prepay thier subscriptions and receive 260 issues over the year.To attract more subscribers, the company offered new subscribers the ability to pay $110 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through Central Park in a horse-drawn carriage. The list price of a carriage ride is $100 per hour. The company estimates that approximately 30% of the coupons will redeemed.
a. How much revenue should Manhattan Today recognize upon receipt of the $110 subscriptions price?
b. How many performance oligation exist in this contract?
c. Prepare the jornal entry to recognize sale of 14 new subscriptions, clearly idenitfying the revenue or unearned revenue associated with each performance obligation.