Problem 1. Hobbit Company sold 700,000 boxes of chocolate chip cookies under a new sales promotion program. Each box contains one coupon, which if submitted with P40, entitles the customer to water jug. Hobbit pays P60 per jug and P5 for handling and shipping. Hobbit estimates that 70% of the coupons will be redeemed even though only 250,000 coupons had been processed in 2021. How much should Hobbit report as liability for unredeemed coupons at December 31, 2021?

Problem 1. Hobbit Company sold 700,000 boxes of chocolate chip cookies under a new sales promotion program. Each box contains one coupon, which if submitted with P40, entitles the customer to water jug. Hobbit pays P60 per jug and P5 for handling and shipping. Hobbit estimates that 70% of the coupons will be redeemed even though only 250,000 coupons had been processed in 2021. How much should Hobbit report as liability for unredeemed coupons at December 31, 2021?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Teddy Dog Food Incorporated (TDFI) currently makes and sells one type and size of dog food, a 16 ounce bag of all-natural freeze-dried chicken. TDFI sells each bag of food for $10. The Variable Expense per bag of food is $6. Fixed Expenses per month total $300. If TDFI sells three extra bags of dog food, by how much does TDFI's overall profit increase? Omit the dollar sign in your answer.
A company is currently offering terms of 1/10 net 45 to its customers. If the average invoice is $200,000, and the company's cost of capital is 8%, would the company be better off if their customers take the discount or not? answer choices: No. The seller is better off by $580 if the buyers pay on Day 45 Yes, because the seller is better off by about $580 if the buyers take the discount. No. The seller is better off by $480 if the buyers pay on Day 45 Yes, because the seller is better off by about $480 if the buyers take the discount.
Assume Costco wants to compete with large manufacturers of golf bags. Costco begins selling a new model of golf bag in its stores for $150. The bag comes with a coupon that customers may mail in to receive a free box of one dozen Kirkland (Costco's brand) golf balls. Each dozen golf balls cost Costco $9.50 to produce and $1.50 to mail to the customer. Kirkland estimates that 40% of the customers who buy a golf bag will mail in the coupon for the free golf balls. During the first quarter of 2020 Costco sold 12,000 golf bags. During that time, 1,000 customers mailed in their coupons and Costco sent them their golf balls. What is the rebate expense and liability, respectively, shown on Costco's financial statements at the end of the first quarter of 2020?
Magtatagumpay Company inaugurated a promotional campaign on January 2, 2029 to promote the salability of their product, Ghost Cereals. Magtatagumpay placed a coupon redeemable for a premium in each package of cereal sold at P200. Each premium, a limited edition water bottle cooling device, costs P25 and 10 coupons must be presented by a customer to receive a premium. Magtatagumpay estimated that only 70% of the coupons issued would be redeemed. For the 6 months ended July 31, 2019, the following transactions occurred: Packages of cereal sold 120,000 Premium purchased 30,000 Coupons redeemed 54,000 How much should be reported as premium expense for coupons on the fiscal year ended July 31, 2029?
Beginning the year 2020, the ABC Company began marketing its phone. Each phone sells for P50,000. To promote and expedite sales of this product, the management of ABC is offering one proof of purchase seal for a special slim transparent case to each customer for every unit of Samsung phone. ABC estimates that out of the units sold during 2020, only 60% of the proof of purchase seals will be redeemed. Sales of phone during 2021 totaled P50 million. For that year, 625 special slim transparent cases were purchased by the company at a total cost of P750,000. These 625 special slim transparent cases have a total sales value of P1,250,000. A total of 320 special slim transparent cases were distributed to customers during the year 2020. How much is the unearned revenue for unredeemed premiums reported in ABC's December 31, 2020 statement of financial position?
Gerard Appliances, Inc., is a small manufacturer of washing machines and dryers. It sells its products to large, established discount retailers that market the appliances under their own names. Gerard generally sells the appliances on trade credit terms of n/60, but if a customer wants a longer term, it will accept a note with a term of up to nine months. At present, the company is having cash flow troubles and needs $10 million immediately. Its Cash balance is $400,000, its Accounts Receivable balance is $4.6 million, and its Notes Receivable balance is $7.4 million. (a) How might Gerard Appliances use its accounts receivable and notes receivable to raise the cash it needs? (b) What are its prospects for raising the needed cash?
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Golden Gate Novelties (GGN) sells souvenir key chains at the local airport. GGN charges $12.00 per chain. The variable cost for a chain, including the wholesale cost of the chain, packaging, the commission paid to the airport operator, and so on, is $10.40. The annual fixed cost for GGN is $15,000. Required: a. How many cases must Golden Gate Novelties sell every year to break even? Note: Do not round intermediate calculations. b. The owner of GGN believes that the company can sell 12,500 chains a year. What is the margin of safety in terms of the number of chains? a. Break-even point b. Margin of safety chains chains
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SNM Bhd offers coupons to its customers in an effort to increase its annual sales. The company places 1 coupon in each packet of Product A. Customers can exchange 10 coupons for 1 decorative clock. In 2018, SNM Bhd purchases in cash 2,500 units of decorative clock at RM10.00 each. The company also sold 50,000 units of Product A at a price of RM20.00 each. SNM Bhd estimated that 40% of the coupons will be redeemed. As of 31 December 2018, only 15,000 coupons were presented for redemption. REQUIRED: (a) Prepare the necessary journal entries for SNM Bhd during the year 2018. Please show your calculations. (b) Determine the asset and liability that relate to the above transactions that would appear on 31 December 2018 Statement of Financial Position.
3.- The Company Surteco sells 10.000 units of their wrapped moluldings for 1.5€/unit, per year. They are offering 3/10, n30, and the discount is taken by 40% of the customers. What is the total value of the Accounts receivable? In order to gain market share against Lamidecor, their competitor, they are thinking about offering 4/5,n45. What is now the new value for accounts receivable if the % of discount taken is still 40%?
Kk.421.

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