In December 2021, Texan Company began including one coupon in each package of candy that it sells and offering a toy in exchange for 50 centavos am five coupons. The toys cost Texan 80 centavos each. Eventually 60% of the coupons will be redeemed. During December, Texan sold 110,000 packages of candy and no coupons were redeemed. In its December 31, 2021, balance shee what amount should Texan report as estimated liability for coupons?

In December 2021, Texan Company began including one coupon in each package of candy that it sells and offering a toy in exchange for 50 centavos am five coupons. The toys cost Texan 80 centavos each. Eventually 60% of the coupons will be redeemed. During December, Texan sold 110,000 packages of candy and no coupons were redeemed. In its December 31, 2021, balance shee what amount should Texan report as estimated liability for coupons?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 11EB: Gear Up Co. pays 65% of its purchases in the month of purchase, 30% in the month after the purchase,...

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In December 2021, Texan Company began including one coupon in each package of candy that it sells and offering a toy in exchange for 50 centavos and five coupons. The toys cost Texan 80 centavos each. Eventually 60% of the coupons will be redeemed. During December, Texan sold 110,000 packages of candy and no coupons were redeemed. In its December 31, 2021, balance sheet, what amount should Texan report as estimated liability for coupons?
In December 2021, Belarmino Company began including one coupon in each package of candy that is sells and offering a toy in exchange of P5 and five coupons. The toys cost P8 each. Eventually, 60% of the coupons will be redeemed. During December, Belarmino Company sold 110,000 packages of candy and no coupons were redeemed. Belarmino Company should report an estimated liability for coupons of Group of answer choices 105,600 198,000 39,600 528,000
During 2020, STU Company sold 500,000 boxes of brownies mix under a new sales promotional program. Each box contains one coupon, which when submitted with P40 entitles the customer a roll of baking sheet paper . ABC pays P50 per pan and P5 for handling and shipping. ABC estimates that 80% of the coupon will be redeemed, even though only 300,000 coupons have been processed during the year. What amount should ABC report as liability for unredeemed coupons as of December 31, 2020?
During 2020, Maine Company Sold 50,000 boxes of hotcakes under a new sales promotional program. Each box contains one coupon, which when submitted with P 16, entitles the customer to a banking pan. Maine Co. pay P 20 per pan and P 2 handling and shipping. Maine estimates that 80% of the coupons will be redeemed, even though only 30,000 coupons had been processed during 2020. What amount should Maine report as a liability for unredeemed coupons at Dec. 31, 2020? * A.P 1,000,000 B.P 400,000 C.P 600,000 D.P 300,000
luna Company sold 700,000 boxes of “puto” mix under a new sales promotional program. Each box contains one coupon, which if submitted with P40, entitles the customer to a kitchen knife. The company pays P60 per knife and P5 for handling and shipping. It estimates that 70% of the coupons will be redeemed, even though only 250,000 coupons had been processed during 2020. How much should luna report as liability for unredeemed coupons at December 31, 2020?
Ariana Corporation includes two coupons in each box of cereal box and 9 coupons are needed to be redeemed for the customer to receive a child’s toy dog. In 2020, Ariana Corporation purchased 4,700 toy dogs at $1.05 each. They sold 75,100 boxes of cereal at $4.75 per box, of which the coupons portion is valued at $.25 per box. In total, 31,500 coupons were presented for redemption in 2020. It is estimated that 40% of the coupons will eventually be redeemed. The company uses the Expense approach. Required: Prepare the journal entries required for 2020 using the Expense approach, specifically for the sales of the cereal boxes, the purchase of the toy dogs, the redeemed coupons and the accrual required at year end. Show all calculations. If the company had used the Revenue approach instead, how much revenue from the coupons redeemed would be recorded in 2020?
During 2021, Truffle Company sold 500,000 boxes of hotcakes under a new sales promotional program. Each box contains one coupon, which when submitted with P16, entitles the customer to a baking pan. Truffle pays P20 per pan and P2 for handling and shipping. Truffle estimate that 80% of the coupons will be redeemed, even though only 300,000 coupons had been processed during 2021. What amount should Truffle report as a liability for unredeemed coupons at December 31, 2021?
Ben and Co. inaugurated a sales promotion campaign on May 31, 2019, whereby Ben placed a coupon in each package of chocolate sold, the coupons being redeemable for a premium. Each premium costs Ben P 50 and a customer to receive a coupon must present five coupons. Ben estimated that only 60 % of the coupon issued would be redeemed. For the seven months ended Dec. 3, 2019, the following information is available: Packages of chocolates sold 400,000 Premium purchased 30,000 Coupons redeemed 100,000 How much is the estimated liability for premium claims outstanding at Dec. 31, 2019? * A.P 180,000 B.P 140,000 C.P 240,000 D.P 100,000
Marigold Company includes one coupon in each box of soap powder that it packs, and 10 coupons are redeemable for a premium (a kitchen utensil). In 2020, Marigold Company purchased 9,100 premiums at 75 cents each and sold 101,000 boxes of soap powder at $ 3.60 per box; 40,800 coupons were presented for redemption in 2020. It is estimated that 60% of the coupons will eventually be presented for redemption.Prepare all the entries that would be made relative to sales of soap powder and to the premium plan in 2020. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
What is the total face amount of coupons issued by JENNIE Inc. in 2021? In packages of its products, JENNIE Inc. includes coupons that may be presented at retail stores to obtain discounts on other JENNIE products. Retailers are reimbursed for the face amount of coupons redeemed plus 10% of that amount for handling costs. JENNIE honors requests for coupon redemption by retailers up to 3 months after the consumer expiration date. JENNIE estimates that 60% of all coupons issued will ultimately be redeemed. Information relating to coupons issued by JENNIE during 2021 is as follows: Consumer expiration date - December 31, 2021; Total payments to retailers as of December 31, 2021 - ₱165,000; Liability for unredeemed coupons as of December 31, 2021 - ₱99,000. a.) ₱ 440,000 b.) ₱ 400,000 c.) ₱ 600,000 d.) ₱ 264,000
Sweet Dates Company offers a premium to its customers—a glass bowl (cost to Sweet Dates is $0.90) upon return of 40 coupons. Two coupons are placed in each box of dates sold. The company estimates, on the basis of past experience, that only 70% of the coupons will ever be redeemed. During 2019, 10 million boxes of dates are sold at $0.30 each. Eight million coupons are redeemed during 2019. Sweet Dates purchased 360,000 glass bowls for the plan on January 1, 2019. Required: 1. Prepare the journal entries related to the sale of dates and the premium plan in 2019. 2. Show how the preceding items would be reported on the December 31, 2019, balance sheet.
During 2021, SUGA Company sold 485,000 boxes of cereals under a new sales promotional program. Each box contains one coupon, which entitles the customer to a premium that cost the company ₱75. Five coupons plus a remittance of ₱20 must be presented by the customer to receive a premium. SUGA estimated that 85% of the coupons will be redeemed. Actual premiums redeemed were 5,000 units. Additional information disclosed that ₱10 per premium is incurred for storage and distribution. Compute for the liability for the unredeemed coupons.