In packages of its products, Rolex Company includes coupons that may be presented at retail stores to obtain discounts on various products. Retailers are reimbursed for the face amount of coupons redeemed plus 15% of that amount for handling cost. The Company honors requests for coupon redemption by retailers up to 5 months after the consumer expiration date. The Company estimates that 50% of all coupons issued will ultimately be redeemed. Information relating to coupons issued by the Company during 2022 is as follows: Liability for unredeemed coupons as of 12/31/2022 P237,500 Total payments to retailers as of 12/31/2022 P165,000 Q4 – What is the amount of estimated premium liability at the setup date? Q5 – What is the amount of handling charges? Q6 – What is the face amount of coupons issued by Rolex Company?
In packages of its products, Rolex Company includes coupons that may be presented at retail stores to obtain discounts on various products. Retailers are reimbursed for the face amount of coupons redeemed plus 15% of that amount for handling cost. The Company honors requests for coupon redemption by retailers up to 5 months after the consumer expiration date. The Company estimates that 50% of all coupons issued will ultimately be redeemed. Information relating to coupons issued by the Company during 2022 is as follows:
Liability for unredeemed coupons as of 12/31/2022 P237,500 Total payments to retailers as of 12/31/2022 P165,000
Q4 – What is the amount of estimated premium liability at the setup date?
Q5 – What is the amount of handling charges?
Q6 – What is the face amount of coupons issued by Rolex Company?
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