Regal Company sells gift certificates, redeemable for store merchandise. The gift certificates have no expiration date. The entity has the following information pertaining to the gift certificate sales and redemptions: - Unearned revenue on January 1, 2020 2020 sales 2020 redemptions of prior year sales 750,000 2,500,000 250,000
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- Serene Company purchases fountains for its inventory from Kirkland Inc. The following transactions take place during the current year. A. On July 3, the company purchases thirty fountains for $1,200 per fountain, on credit. Terms of the purchase are 2/10, n/30, invoice dated July 3. B. On August 3, Serene does not pay the amount due and renegotiates with Kirkland. Kirkland agrees to convert the debt owed into a short-term note, with an 8% annual interest rate, payable in two months from August 3. C. On October 3, Serene Company pays its account in full. Record the journal entries to recognize the initial purchase, the conversion, and the payment.Purchase-related transactions The following selected transactions were completed by Epic Co. during August of the curr ent year: Aug. 3. Purchased merchandise on account for $33400, terms FOB destination. 2/10. n/30. 9. Issued debit memorandum for $2500 ($2450 net of 2% discount) for merchandise from the August 3 purchase that was damaged in shipment. 10. Purchased merchandise on account, $25,000, terms FOB shipping point, n/com. Paid $600 cash to the freight company for delivery of the merchandise. 13. Paid for invoice of August 3, less debit memorandum of August 9 31. Paid for invoice of August 10. Instructions Illustrate the effects of each of the preceding transactions on the accounts and financial statements of Epic Co. Identify each transaction by date.Regal Company sells gift certificates, redeemable for store merchandise. The gift certificates have no expiration date. The entity has the following information pertaining to the gift certificate sales and redemptions: Unearned revenue on January 1, 2020 = 750,000; 2020 sales = 2,500,000; 2020 redemptions of prior year sales = 250,000; 2020 redemptions of current year sales = 1,750,000. What amount should be reported as unearned revenue on December 31, 2020?
- Bloom Company sells gift certificates redeemable only when merchandise is purchased. Upon redemption, the entity recognizes the unearned revenue as realized. Information for the current year:Unearned gift certificates revenue, January 1 ₱ 250,000Gift certificates sold 1,745,000Gift certificates redeemed 1,483,250Gift certificates which expired 80,000Gross profit rate based on cost 25% Requirements:8. What amount should be reported for the year ended December 31 as:A. SalesB. Cost of SalesBloom Company sells gift certificates redeemable only when merchandise is purchased. Upon redemption, the entity recognizes the unearned revenue as realized. Information for the current year:Unearned gift certificates revenue, January 1 ₱ 250,000Gift certificates sold 1,745,000Gift certificates redeemed 1,483,250Gift certificates which expired 80,000Gross profit rate based on cost 25% Requirements: What amount should be reported for the year ended December 31 as Gross Profit? Unearned gift certificates revenue?Siomai Corp. sells gift certificates redeemable only when merchandise is purchased. The certificates have an expiration date two years after issuance. Upon redemption or expiration, Siomai recognizes the unearned revenue as realized. Data for the year are as follows: Unearned revenue, January 1, 2021- P3,000,000 Gift certificates sold- P10,000,000 Gift certificates redeemed- P8,200,000 Expired gift certificates- P600,000 Cost of goods sold- 60% On December 31, 2021, Siomai should report unearned revenues of:
- Dynasty Company sells gift certificates redeemable only whenmerchandise is purchased. Upon redemption, Dynasty Companyrecognizes the unearned revenue as realized. Information for 2019 is asfollows: Unearned Revenue, January 1, 2019 P650,000; Gift certificatessold P2,250,000; Gift certificates redeemed P1,950,000; Gift certificatesunredeemed for a long time P100,000; Cost of Goods Sold 60%. Whatamount should be reported as Unearned Revenue on December 31, 2019,following the ruling by the Department of Trade and Industry that giftcertificates no longer have an expiration period?4. WALNUT Department Store sells gift certificates, redeemable for store merchandise that expires one year after their issuance. WALNUT has the following information pertaining to its gift certificates sales and redemptions: Unearned at December 31, 2020 - ₱600,000; 2021 sales - ₱2,000,000; 2021 redemptions of prior-years sales -₱200,000; 2021 redemptions of current-year sales-₱1,400,000. In its December 31, 2021 statement of financial position, what amount should WALNUT report as unearned revenue? a. ₱ 800,000 b. ₱ 400,000 c. ₱ 1,000,000 c. ₱ 600,0004. WALNUT Department Store sells gift certificates, redeemable for store merchandise that expires one year after their issuance. WALNUT has the following information pertaining to its gift certificates sales and redemptions: Unearned at December 31, 2020 - ₱600,000; 2021 sales - ₱2,000,000; 2021 redemptions of prior-years sales -₱200,000; 2021 redemptions of current-year sales-₱1,400,000. In its December 31, 2021 statement of financial position, what amount should WALNUT report as unearned revenue?
- 1. WALNUT Department Store sells gift certificates, redeemable for store merchandise that expires one year after their issuance. WALNUT has the following information pertaining to its gift certificates sales and redemptions: Unearned at December 31, 2020 - ₱600,000; 2021 sales - ₱2,000,000; 2021 redemptions of prior-years sales -₱200,000; 2021 redemptions of current-year sales-₱1,400,000. In its December 31, 2021 statement of financial position, what amount should WALNUT report as unearned revenue? 2.On December 31, 2021, PISTACHIO Company had outstanding ₱20 million face value convertible bonds maturing on December 31, 2024. Interest is payable annually on December 31. Each ₱1,000 bond is convertible into 60 shares of PISTACHIO’s ₱P10 par ordinary shares. The unamortized premium balance on December 31, 2021 is ₱350,000. The balance of Share premium arising from bond conversion privilege is ₱640,000. On this date, assume that on December 31, 2021, PISTACHIO retired the ₱2,000,000 issue…SM Department store sells gift certificated, redeemable for store merchandise that expires one year after their issuance. SM has the following information pertaining to its gift certificate sales and redemptions: Liability for Gift Certificates Outstanding at Dec. 31, 2021 P 400,000 2022 Sales 1,500,000 2022 redemptions of prior-year’s sales 150,000 2022 redemptions of current-year’s sales 1,250,000 How much is the balance of liability for gift certificate at the end of 2022?Cucu Company sells gift certificates redeemable only when merchandise is purchase. The certificates have anexpiration date two years after issuance date. Upon redemption or expiration, Cucu Company recognizes theunearned revenue as realized. Data for 2020 are as follows:Unearned revenue, 1/1/2020 P800,000Gift certificates sold 4,000,000Gift certificates redeemed 3,200,000Expired gift certificates 400,000Cost of goods sold 60%At December 31, 2020, what amount of current liability should Cucu report in relation to gift certificates?a. P1,200,000 b. P800,000 c. P400,000 d. d. P0
