Use the Following Information for Questions

question 227

Multiple Choice

Use the following information for questions. A product and service are bundled together and sold to customers for $350.The fair values of the product and service are $300 and $100 respectively.
-On January 1, 2014, Trumpet Ltd.sold land that cost $180,000 for $240,000, receiving a note bearing interest at 10 percent.The note will be paid in three annual instalments of $96,510 starting December 31, 2014.Assuming that collection of the note is very uncertain, how much revenue from this sale should Trumpet recognize in 2014?

• A)$0
• B)$18,000
• C)$24,000
• D)$96,510

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Definitions:

Private Office

A room or suite of rooms designated for the use of a single individual or a small group, typically in a workplace, providing privacy and space for professional duties.

Fair Labor Standards Act

U.S. federal law that establishes minimum wage, overtime pay eligibility, recordkeeping, and child labor standards affecting full-time and part-time workers in the private sector and in Federal, State, and local governments.

Interstate Commerce

Commercial transactions or movement of goods and services across state boundaries, which is regulated by the federal government.

COBRA

A law that provides former employees, retirees, spouses, former spouses, and dependent children the right to temporary continuation of health coverage at group rates.