Blue Company offers a set of building blocks to customers who send in 3 UPC codes from Blue cereal, along with 50¢. The block sets cost Blue $1.30 each to purchase and 70¢ each to mail to customers. During 2025, Blue sold 1,536,000 boxes of cereal. The company expects 30% of the UPC codes to be sent in. During 2025, 153,600 UPC codes were redeemed. Prepare Blue's December 31, 2025, adjusting entry. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. List all debit entries before credit entries.) Account Titles and Explanation Premium Expense Premium Liability Debit 230400 Credit 230400

Blue Company offers a set of building blocks to customers who send in 3 UPC codes from Blue cereal, along with 50¢. The block sets cost Blue $1.30 each to purchase and 70¢ each to mail to customers. During 2025, Blue sold 1,536,000 boxes of cereal. The company expects 30% of the UPC codes to be sent in. During 2025, 153,600 UPC codes were redeemed. Prepare Blue's December 31, 2025, adjusting entry. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. List all debit entries before credit entries.) Account Titles and Explanation Premium Expense Premium Liability Debit 230400 Credit 230400

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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Question

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Please help me understand how to get the correct answer.

Blue Company offers a set of building blocks to customers who send in 3 UPC codes from Blue cereal, along with 50¢. The block sets
cost Blue $1.30 each to purchase and 70¢ each to mail to customers. During 2025, Blue sold 1,536,000 boxes of cereal. The company
expects 30% of the UPC codes to be sent in. During 2025, 153,600 UPC codes were redeemed. Prepare Blue's December 31, 2025,
adjusting entry. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are
automatically indented when amount is entered. Do not indent manually. List all debit entries before credit entries.)
Account Titles and Explanation
Premium Expense
Premium Liability
Debit
230400
Credit
230400

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