TDC Department Store sells gift certificates that are redeemable only when the merchandise is purchased from its stores. It is the company’s policy to recognize the amount redeemed as realized. During 2019, ABC Department Store sold gift certificates amounting to P1,800,000 and redeemed gift certificates worth P1,560,000. Gift certificates outstanding at January 1, 2019 is P520,000. The company’s gross profit rate is 40%. What is the liability for outstanding gift certificates at December 31, 2019?
TDC Department Store sells gift certificates that are redeemable only when the merchandise is purchased from its stores. It is the company’s policy to recognize the amount redeemed as realized. During 2019, ABC Department Store sold gift certificates amounting to P1,800,000 and redeemed gift certificates worth P1,560,000. Gift certificates outstanding at January 1, 2019 is P520,000. The company’s gross profit rate is 40%. What is the liability for outstanding gift certificates at December 31, 2019?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter9: Current Liabilities And Contingent Obligations
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TDC Department Store sells gift certificates that are redeemable only when the merchandise is purchased from its stores. It is the company’s policy to recognize the amount redeemed as realized. During 2019, ABC Department Store sold gift certificates amounting to P1,800,000 and redeemed gift certificates worth P1,560,000. Gift certificates outstanding at January 1, 2019 is P520,000. The company’s gross profit rate is 40%.
What is the liability for outstanding gift certificates at December 31, 2019?
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