Business, 20.10.2021 20:00, princesstn28oqlfir

On January 1, 2017, Loud Company enters into a 2 year contract with a customer for an unlimited talk and 5 GB data wireless plan for $65 per month. The contract includes a smartphone for which the customer pays $j299. Loud also sells the smartphone and monthly service plan separately, charging $649 for the smartphone and $65 for the mointhly service for unlimited talk and 5 GB data wireless plan. Contract Modification- Assume the same facts above. On July 1, 2017, the customer realizes that she needs less data in her wireless plan and downgrade to the unlimited talk and 2 GB data plan for the remaining term of the contract (18 months). The unlimited talk and 2 GB data plan is priced at $55 per month. The $55 per month is Loud's current stand- alone price for this plan that is available to all customers.
Required
1. How should Loud account for this contract modification?
2. Provide Loud's new monthly revenue recognition journal entry.

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On January 1, 2017, Loud Company enters into a 2 year contract with a customer for an unlimited talk...