Question

thank you to whoever can help, it's greatly appreciated!

Waterway offers an MP3 download (seven-single medley) as a premium for every 6 candy bar wrappers presented by customers together with $2.80. The candy bars are sold by the company to distributors for 30 cents each. The purchase price of each download code to the company is $2.55. In addition, it costs 50 cents to distribute each code. The results of the premium plan for the years 2020 and 2021 are as follows. (All purchases and sales are for cash.) MP3 codes purchased Candy bars sold Wrappers redeemed 2020 wrappers expected to be redeemed in 2021 2021 wrappers expected to be redeemed in 2022 2020 2021 390,000 514,800 2,809,900 2,574,700 1,872,000 2,340,000 452,400 546,000

Answer 1

CR DR $ 9,94,500.00 =390000*2.55 Particulars Inventory of premiums Cash To record the premium inventory $ 9,94,500.00 $ 8,42,970.00 =2809900*0.3 Cash Sales revenue To record the sale $ 8,42,970.00 =(1872000/6)*(2.8-0.5) 7,17,600.00 78,000.00 Cash $ Premium expense $ Inventory of premium To record the expense associated with the sale $ 7,95,600.00 =(1872000/6)*2.55 $ 18,850.00 -452400/6*2.55+0.5-2.8) Premium expense Premium liability To record the premium liablity $ 18,850.00 CR DR $ 13,10,700.00 =514000*2.55 Particulars Inventory of premiums Cash To record premium inventory $ 13,10,700.00 $ 7,72,410.00 =2574700*0.3 Cash Sales revenue To record the sale $ 7,72,410.00 Cash $ 8,77,500.00 Premium expense $ 94,380.00 Premium liability $ 22,620.00 Inventory of premiums To record the expense associated with the sale. =((2340000-452400)/5)*0.25 -452400/5*2.55+0.5-2.8) =2340000/6*2.55 $ 9,94,500.00 $ 22,750.00 =546000/6*(2.55+0.5-2.8) Premium expense Premium Liability $ 22,750.00 Account Inventory of premiums Premium liability Premium expense 2020 198900$ 18,850.00 $ 96,850.00 $ 2021 Classification 3,16,200.00 Current asset 22,750.00 Current liability 1,17,130.00 Selling expense $ $ Account Inventory of premiums Premium liability Premium expense 2020 2021 =994500-795600 =1310700-994500 $ 18,850.00 $ 22,750.00 =18850+78000 =22750+94380