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ABC 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?

ABC 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?

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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ABC 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? To input answers, kindly follow the sample format below(no peso sign, with comma, no space): ex. 100,000
Transcribed Image Text:ABC 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? To input answers, kindly follow the sample format below(no peso sign, with comma, no space): ex. 100,000
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