What amount is included in the sales revenue when Grando sells the production equipment with an extended warranty?

When Grando sells production equipment with an extended warranty, the sales revenue recognized from the sale typically includes the cash or the fair market value received for the equipment itself, which in this case is represented by the amount of 50,000. However, any additional revenue generated from the sale of the warranty must also be taken into account.

The extended warranty represents an additional service that Grando is providing, and the revenue from such warranties is often recognized separately. If the warranty is sold for a price of 800, this amount also contributes to total sales revenue. Therefore, when both the equipment sale and the extended warranty are combined, the total sales revenue would be the sum of these two amounts: 50,000 for the equipment and 800 for the warranty.

Thus, the total sales revenue that should be included is 50,000 + 800 = 50,800. This holistic view of sales revenue captures not only the immediate sale of the asset but also the additional income from services associated with the sale, complying with revenue recognition principles in accounting.