Question

Jung Statisticians operates a website that links experienced statisticians with businesses that need analysis. Statisticians posts their qualifications and rates on the website and Jung receives 25% of the fee paid to the statisticians in exchange for identifying potential customers. FastMed Associates contacts Jung and arranges to pay a consultant $1,500 in exchange for analyzing some data. Jung's income statement should include the following with respect to this transaction: Group of answer choices

A. Revenue of $1,875 and cost of services of $1,500

B. Revenue of $1,500

C. Revenue of $375

D. Revenue of $1,500 and cost of services of $1,125

Answer 1

Jung Statisticians operates a website that links experienced statisticians with businesses that need analysis.

Thus, J.S. is acting like commission agent which charges commission from its customers (Statisticians) on the amount of consulting fee charged by statisticians.

In the given case, the consultant is receiving a fee of $1,500 from the contractor FastMed Associates .

J.S. receive a commission of 25% on the fee charged by the consultant.

Hence, J.S. will record a revenue of = 1,500 x 25%

= $375

Correct option is (C)