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Issue 1: Service Revenue ACE has included service revenue of $122,800 as a result of a number of one year service policies sold late in December, 2018. These service policies became effective on January 1, 2019. The policies are sold at an average of $600 per year per customer; the $122,800 represents the total cash received as of year-end (debit cash, credit service revenue). The $600 per customer amount was arrived at by an analysis of previous service provided on a "fee for service" basis to customers. The average cost to ACE was approximately $200 per visit, with an average of 1.7 visits per year to customers. While the service policies allow unlimited visits for service. ACE has restricted the number of policies available due to difficulties in calculating the costs associated with such policies. ACE estimates that the number service calls is likely to increase and the cost is expected to decrease to around $150 per call. What entry or disclosure, if any, is necessary in this circumstance? Issue 1: Service Revenue ACE has included service revenue of $122,800 as a result of a number of one year service policies sold late in December, 2018. These service policies became effective on January 1, 2019. The policies are sold at an average of $600 per year per customer; the $122,800 represents the total cash received as of year-end (debit cash, credit service revenue). The $600 per customer amount was arrived at by an analysis of previous service provided on a "fee for service" basis to customers. The average cost to ACE was approximately $200 per visit, with an average of 1.7 visits per year to customers. While the service policies allow unlimited visits for service. ACE has restricted the number of policies available due to difficulties in calculating the costs associated with such policies. ACE estimates that the number service calls is likely to increase and the cost is expected to decrease to around $150 per call. What entry or disclosure, if any, is necessary in this circumstance

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