Problem 2-7 (IFRS) Sydney Company is a retailer that sells clothing. The entity has launched a promotional campaign wherein if customers buy clothing with a single purchase of at least P12,000, the entity shall issue "30% discount coupons" on selected items for 2 months following the campaign. During the campaign, the entity sold clothing worth P3,240,000 and had issued 100 "30% discount coupons". It is expected that 80% of the coupons will be redeemed and customers using the coupons will buy clothing at an average price of P15,000. Required: 1. Compute the stand-alone selling price of the discount coupons. 2. Allocate the transaction price to the products sold and the discount coupons. 3. Prepare journal entries for the current year including the redemption of the coupons. Problem 2-8 (IFRS) Nia Company is a retailer and has launched a promotional campaign wherein if customers buy clothing with a single purchase of at least P4,000, the entity shall issue "40 discount coupons" on selected items. The coupons may be used for 2 months following the campaign. During the campaign, the entity sold clothing worh P1,860,000 and issued 100 "40% discount coupons". The entity expected that 70% of the coupons will be redeemed and customers using the coupons buy clothing at an average price of P5,000. Required: 1. Compute the stand-alone price of the discount coupons. 2. Allocate the transaction price to the products sold and the discount coupons. 3. Prepare the journal entry to recognize the sale of the products and issue of discount coupons. Prepare the journal entry to recognize the redemption of 4. coupons.
Problem 2-7 (IFRS) Sydney Company is a retailer that sells clothing. The entity has launched a promotional campaign wherein if customers buy clothing with a single purchase of at least P12,000, the entity shall issue "30% discount coupons" on selected items for 2 months following the campaign. During the campaign, the entity sold clothing worth P3,240,000 and had issued 100 "30% discount coupons". It is expected that 80% of the coupons will be redeemed and customers using the coupons will buy clothing at an average price of P15,000. Required: 1. Compute the stand-alone selling price of the discount coupons. 2. Allocate the transaction price to the products sold and the discount coupons. 3. Prepare journal entries for the current year including the redemption of the coupons. Problem 2-8 (IFRS) Nia Company is a retailer and has launched a promotional campaign wherein if customers buy clothing with a single purchase of at least P4,000, the entity shall issue "40 discount coupons" on selected items. The coupons may be used for 2 months following the campaign. During the campaign, the entity sold clothing worh P1,860,000 and issued 100 "40% discount coupons". The entity expected that 70% of the coupons will be redeemed and customers using the coupons buy clothing at an average price of P5,000. Required: 1. Compute the stand-alone price of the discount coupons. 2. Allocate the transaction price to the products sold and the discount coupons. 3. Prepare the journal entry to recognize the sale of the products and issue of discount coupons. Prepare the journal entry to recognize the redemption of 4. coupons.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Problem 2-7 (IFRS)
Sydney Company is a retailer that sells clothing. The entity
has launched a promotional campaign wherein if customers
buy clothing with a single purchase of at least P12,000, the
entity shall issue "30% discount coupons" on selected items
for 2 months following the campaign.
During the campaign, the entity sold clothing worth
P3,240,000 and had issued 100 "30% discount coupons".
It is expected that 80% of the coupons will be redeemed and
customers using the coupons will buy clothing at an average
price of P15,000.
Required:
1. Compute the stand-alone selling price of the discount
coupons.
2. Allocate the transaction price to the products sold and
the discount coupons.
3. Prepare journal entries for the current year including
the redemption of the coupons.
Problem 2-8 (IFRS)
Nia Company is a retailer and has launched a promotional
campaign wherein if customers buy clothing with a single
purchase of at least P4,000, the entity shall issue "40 discount
coupons" on selected items.
The coupons may be used for 2 months following the
campaign. During the campaign, the entity sold clothing
worh P1,860,000 and issued 100 "40% discount coupons".
The entity expected that 70% of the coupons will be redeemed
and customers using the coupons buy clothing at an average
price of P5,000.
Required:
1. Compute the stand-alone price of the discount coupons.
2. Allocate the transaction price to the products sold and
the discount coupons.
3. Prepare the journal entry to recognize the sale of the
products and issue of discount coupons.
Prepare the journal entry to recognize the redemption of
4.
coupons.
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