On October 1, 2019, Fun Phone Company made the following offer: If a customer agreed...
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On October 1, 2019, Fun Phone Company made the following offer: If a customer agreed to purchase two years (i.e. 24 months) of Cellular Service with unlimited data at a price of $ 50 per month, the customer would receive a "free" phone. A similar phone, if purchased independently, would cost $ 595. Using an appropriate discount rate, the present value of two years of payments of $ 50 per month is $ 980. In accordance with ASC 606, what is the total "Transaction Price" for a customer who signs a contract with Fun Phone Company?
A.$ 980 B.$ 1,200 C.$ 1,795 D.None of the above
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