ABC Company, a grocery retailer, operates a customer loyalty program. The entity grants program members loyalty points when they spend a specified amount on groceries. Program members can redeem the points for further groceries. The points have no expiry date. During 2019, the sales amounted to P7,000,000 and the entity have granted 10,000 points. Management expects that only 80% of the points will be redeemed. The cost of each loyalty point is P100. As of December 31, 2019, 4,800 points have already been redeemed. In 2020, the management revised its expectations to 90% of the points will be redeemed. As of December 31, 2020, the entity redeemed 2,400 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): PX. 100.000
ABC Company, a grocery retailer, operates a customer loyalty program. The entity grants program members loyalty points when they spend a specified amount on groceries. Program members can redeem the points for further groceries. The points have no expiry date. During 2019, the sales amounted to P7,000,000 and the entity have granted 10,000 points. Management expects that only 80% of the points will be redeemed. The cost of each loyalty point is P100. As of December 31, 2019, 4,800 points have already been redeemed. In 2020, the management revised its expectations to 90% of the points will be redeemed. As of December 31, 2020, the entity redeemed 2,400 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): PX. 100.000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:ABC Company, a grocery retailer, operates a customer loyalty program. The entity grants
program members loyalty points when they spend a specified amount on groceries. Program
members can redeem the points for further groceries. The points have no expiry date.
During 2019, the sales amounted to P7,000,000 and the entity have granted 10,000
points. Management expects that only 80% of the points will be redeemed. The cost of each
loyalty point is P100. As of December 31, 2019, 4,800 points have already been redeemed.
In 2020, the management revised its expectations to 90% of the points will be redeemed. As of
December 31, 2020, the entity redeemed 2,400 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. 100,000
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