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1. What amount should be reported as premium exp for 2022?

1. What amount should be reported as premium exp for 2022?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Problem 2-19 (IAA) Charlene Company included one coupon in each box of laundry soap sold. A towel was offered as a premium to customers who send in 10 coupons and a remittance of P10. Distribution cost of premium is P5. Experience indicated that only 30% of the coupons will be redeemed. Boxes of soap sold Number of towels purchased at P50 each Coupons redeemed a. 2,500,000 b. 2,400,000 c. 1,800,000 d. 2,700,000 1. What amount should be reported as premium expense for 2022? a. 1,000,000 b 1,100,000 C. 800,000 d. 900,000 a. 3,000,000 b. 3,750,000 2. What amount should be reported as estimated premium liability on December 31, 2022? c. 3,375,000 d. 4,000,000 2022 2,000,000 50,000 400,000 3. What amount should be reported as premium expense for 2023? a. 1,000,000 b. 1,250,000 2023 c. 1,125,000 d. 1,375,000 2,500,000 80,000 700,000 59 4. What amount should be reported as estimated premium liability on December 31, 2023?
Transcribed Image Text:Problem 2-19 (IAA) Charlene Company included one coupon in each box of laundry soap sold. A towel was offered as a premium to customers who send in 10 coupons and a remittance of P10. Distribution cost of premium is P5. Experience indicated that only 30% of the coupons will be redeemed. Boxes of soap sold Number of towels purchased at P50 each Coupons redeemed a. 2,500,000 b. 2,400,000 c. 1,800,000 d. 2,700,000 1. What amount should be reported as premium expense for 2022? a. 1,000,000 b 1,100,000 C. 800,000 d. 900,000 a. 3,000,000 b. 3,750,000 2. What amount should be reported as estimated premium liability on December 31, 2022? c. 3,375,000 d. 4,000,000 2022 2,000,000 50,000 400,000 3. What amount should be reported as premium expense for 2023? a. 1,000,000 b. 1,250,000 2023 c. 1,125,000 d. 1,375,000 2,500,000 80,000 700,000 59 4. What amount should be reported as estimated premium liability on December 31, 2023?
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