JUNGKOOK Company sells gift certificates redeemable only when merchandise is purchased. Upon redemption, Jungkook recognizes the unearned revenue as realized. Information for the current year: Unearned gift certificates revenue, January 1 ₱ 250,000 Gift certificates sold 1,745,000 Gift certificates redeemed 1,483,250 Gift certificates which expired 80,000 Gross profit rate based on cost 25% What amount should be reported for the year ended December 31 as: A. Gross profit B. Unearned gift certificates revenue
JUNGKOOK Company sells gift certificates redeemable only when merchandise is purchased. Upon redemption, Jungkook recognizes the unearned revenue as realized. Information for the current year: Unearned gift certificates revenue, January 1 ₱ 250,000 Gift certificates sold 1,745,000 Gift certificates redeemed 1,483,250 Gift certificates which expired 80,000 Gross profit rate based on cost 25% What amount should be reported for the year ended December 31 as: A. Gross profit B. Unearned gift certificates revenue
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter8: Current And Contingent Liabilities
Section: Chapter Questions
Problem 7MCQ
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JUNGKOOK Company sells gift certificates redeemable only when merchandise is purchased. Upon redemption, Jungkook recognizes the unearned revenue as realized. Information for the current year:
| Unearned gift certificates revenue, January 1 | ₱ 250,000 |
| Gift certificates sold | 1,745,000 |
| Gift certificates redeemed | 1,483,250 |
| Gift certificates which expired | 80,000 |
| Gross profit rate based on cost | 25% |
What amount should be reported for the year ended December 31 as:
A. Gross profit
B. Unearned gift certificates revenue
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