On October 1, 1996, Lewis Co. entered into a contract with a customer to sell...
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On October 1, 1996, Lewis Co. entered into a contract with a customer to sell 100 machines for $60 each. The customer obtains control of the machines at contract inception. Lewis allows the customer to return any unused machine within 1 year from the sale date and receive a full refund. Lewis uses the expected value method to estimate the variable consideration. Based on Lewiss experience and other relevant factors, it reasonably estimates that a total of 15 machines will be returned.
What amount of revenue from this contract will be recognized by Lewis in 1996?
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