Regal Company sells gift certificates, redeemable for store merchandise. The gift certificates have no expiration date. The entity has the following information pertaining to the gift certificate sales and redemptions: Unearned revenue on January 1, 2020 = 750,000; 2020 sales = 2,500,000; 2020 redemptions of prior year sales = 250,000; 2020 redemptions of current year sales = 1,750,000. What amount should be reported as unearned revenue on December 31, 2020?
Regal Company sells gift certificates, redeemable for store merchandise. The gift certificates have no expiration date. The entity has the following information pertaining to the gift certificate sales and redemptions: Unearned revenue on January 1, 2020 = 750,000; 2020 sales = 2,500,000; 2020 redemptions of prior year sales = 250,000; 2020 redemptions of current year sales = 1,750,000. What amount should be reported as unearned revenue on December 31, 2020?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Regal Company sells gift certificates, redeemable for store merchandise. The gift certificates have no expiration date. The entity has the following information pertaining to the gift certificate sales and redemptions: Unearned revenue on January 1, 2020 = 750,000; 2020 sales = 2,500,000; 2020 redemptions of prior year sales = 250,000; 2020 redemptions of current year sales = 1,750,000. What amount should be reported as unearned revenue on December 31, 2020?
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