Art Company started a new promotional program. For every 10 box tops returned, customers receive a basketball. The entity estimated that only 60% of the box tops reaching the market would be redeemed. Sales of product 100,000 units P30,000,000 Basketballs purchased 5,500 units P4,125,000 Basketballs distributed 4,000 What amount should be reported as year-end estimated liability associated with this promotion? A. 3,000,000 B. 2,500,000 C. 2,000,000 D. 1,500,000
Art Company started a new promotional program. For every 10 box tops returned, customers receive a basketball. The entity estimated that only 60% of the box tops reaching the market would be redeemed. Sales of product 100,000 units P30,000,000 Basketballs purchased 5,500 units P4,125,000 Basketballs distributed 4,000 What amount should be reported as year-end estimated liability associated with this promotion? A. 3,000,000 B. 2,500,000 C. 2,000,000 D. 1,500,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Art Company started a new promotional program. For every 10 box tops returned, customers receive a basketball. The entity estimated that only 60% of the box tops reaching the market would be redeemed.
Sales of product 100,000 units P30,000,000
Basketballs purchased 5,500 units P4,125,000
Basketballs distributed 4,000
What amount should be reported as year-end estimated liability associated with this promotion?
A. 3,000,000
B. 2,500,000
C. 2,000,000
D. 1,500,000
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