Muggs Co. includes one coupon in each bag of dog food it sells. In return for eight coupons, customers receive a leash. The leashes cost Muggs $4 each. Muggs estimates that 45 percent of the coupons will be redeemed. Data for 2025 and 2026 are as follows: 2025 2026 Bags of dog food sold 500,000 600,000 Leashes purchased 18,000 22,000 Coupons redeemed 120,000 150,000 The premium expense for 2025 is $250,000. $112,500. $100,000. O $60,000.
Muggs Co. includes one coupon in each bag of dog food it sells. In return for eight coupons, customers receive a leash. The leashes cost Muggs $4 each. Muggs estimates that 45 percent of the coupons will be redeemed. Data for 2025 and 2026 are as follows: 2025 2026 Bags of dog food sold 500,000 600,000 Leashes purchased 18,000 22,000 Coupons redeemed 120,000 150,000 The premium expense for 2025 is $250,000. $112,500. $100,000. O $60,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![Muggs Co. includes one coupon in each bag of dog food it sells. In return for eight coupons,
customers receive a leash. The leashes cost Muggs $4 each. Muggs estimates that 45
percent of the coupons will be redeemed. Data for 2025 and 2026 are as follows:
2025
2026
Bags of dog food sold
500,000
600,000
Leashes purchased
18,000
22,000
Coupons redeemed
120,000
150,000
The premium expense for 2025 is
$250,000.
$112,500.
$100,000.
O $60,000.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff2285bee-aff8-4d88-81d7-5336e5af94bf%2F425b73af-a00f-4523-9502-441460dcd7c9%2Fpuenuto_processed.png&w=3840&q=75)
Transcribed Image Text:Muggs Co. includes one coupon in each bag of dog food it sells. In return for eight coupons,
customers receive a leash. The leashes cost Muggs $4 each. Muggs estimates that 45
percent of the coupons will be redeemed. Data for 2025 and 2026 are as follows:
2025
2026
Bags of dog food sold
500,000
600,000
Leashes purchased
18,000
22,000
Coupons redeemed
120,000
150,000
The premium expense for 2025 is
$250,000.
$112,500.
$100,000.
O $60,000.
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