3) A newly opened grocery store, to attract customers, started giving 5 loyalty points for eachdollar spent in the store. These points can be redeemed in blocks of 5000 and customers are eligible toreceive a winter jacket. Since it was newly opened it did not have any past record of how manycustomers will exercise this offer, but because of the winter season round the corner, it is hoping that90% of the people will make use of this redemption offer. The store purchases these jackets directlyfrom the manufacturer at $40 per each.In the month of October, the total sales of the store were $480,000. Please calculate the loyaltyredemption amount that the store needs to provide for October in its books of accounts.

Loyalty Points: Loyalty points are the currency type given by business organizations to their…

Answered: 3) A newly opened grocery store, to…

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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Escargot Inc. is a 5-star restaurant in Cincinnati. The restaurant sells 500 gift cards during January, Year 1. Each gift card has a face value of $300. The gift cards never expire, although based on industry experience, Escargot expects that 12% of the balances will never be redeemed. During February Year 1, S 45,000 of gift cards are redeemed, and in March Year 1, another $80, 000 is redeemed. Required: 1. Prepare journal entries for Escargot's gift card transactions for January through March. 2. Assume that at the end of April, due to the popularity of the restaurant, Escargot reduces its estimate of the amount of gift cards that will go unused to 8%. During April, gift cards worth $10, 000 are used. Prepare any necessary journal entries.
A musical group plans to sell T-shirts bearing their logo at an upcoming concert. They find a supplier who charges $2.50 per plain T-shirt. Printing the logo on the shirt requires a set-up charge of $50 for the order plus $0.75 per shirt. The group places an order for 200 T-shirts and pays a shipping fee of $15 upon receipt. What is the total dollar amount that should be debited to the inventory account for the 200 T-shirts?
Rahul
We have a new client, a start-up called Spark Software. This is their first year with us, and we must make sure they recognize their revenue properly. Spark Software offers customers an inventory management app. They charge customers up front for a one-year subscription, and customers can cancel their subscription anytime within the first 60 days to receive a full refund. Customers can renew their subscriptions each year, 2 months before the subscription expires. Spark Software so far has 3 clients. Below are the dates on which each client signed up and paid for the app, and the amount each paid (different customers get different pricing based on negotiations with the sales team): Customer A Joined: January 1, 2020 Paid: $20,000 Renewed: May 31, 2021 Paid: $10,000 Customer B Joined: March 15, 2020 Paid: $10,000 Cancelled: April 15, 2020 Customer C Joined: June 30, 2020 Paid: $10,000 Renewed: May 31, 2021 Paid: $10,000 How and when should Spark Software recognize revenue…
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Please answer first 2 questions alone but please answer step by step with introductory paragraph.will upvote for sure
ABC Company, a department store operates a customer loyalty program.The entity grants program members loyalty points when they spend a specified amount on their products. Program members can redeem the points for future purchases.The points have no expiry date. During 2020, the sales amounted to P 10,000,000 and the entity grants 5 points for every P 100 purchase. Management expects that only 70% of the points will be redeemed. Fair values of products sold and the reward points for the year were P 9,000,000 and P 1,000,000, respectively.As of December 31, 2020, half of the total points granted have already been redeemed. In 2021, the management revised its expectations to 90% of the points will be redeemed. As of December 31, 2021, there is a redemption of 25% of the remaining points.What amount should be reported as revenue earned from loyalty points in 2020?To input answers, kindly follow the sample format below(no peso sign, with comma, no space):ex. 100,000Failure to follow the…
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Spring Appliances received an invoice dated May 15 with terms 3/10 E.O.M. for the items listed below.5 refrigerators at $970 each less 20% and 5 % 4 dishwashers at $622 each Less 16(1/3), 12.8%, and 3 % (a) What is the last day for taking the cash discount? (b) What is the amount due if the invoice is paid on the last day for taking the discount? (c) What is the amount of the cash discount if a partial payment is made such that a balance of $1700 remains outstanding on the invoice?
Tri-State Bank and Trust is considering giving Crane Company a loan. Before doing so, management decides that further discussions with Crane's accountant may be desirable. One area of particular concern is the inventory account, which has a year-end balance of $290,000. Discussions with the accountant reveal the following. 1. 2. 3. 4. 5. Crane shipped goods costing $34,000 to Lilja Company, FOB shipping point, on December 28. The goods are not expected to arrive at Lilja until January 12. The goods were not included in the physical inventory because they were not in the warehouse. The physical count of the inventory did not include goods costing $91,000 that were shipped to Crane FOB destination on December 27 and were still in transit at year-end. Crane received goods costing $22,000 on January 2. The goods were shipped FOB shipping point on December 26 by Brent Co. The goods were not included in the physical count. Crane shipped goods costing $33,000 to Jesse Co., FOB destination, on…
Munabhai
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