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WENDOLYN Company manufactures noodles. To promote the sale of GWENDOLYN's products, premium is offered to customers who send in three wrappers and remittance of Php 25. The eight-out per premium is Php5. 2020 2021 Sales Premiums purchased at Php 80 each Number of premiums distributed Number of premiums to be distributed next period 4,000,000 400,000 5,000,000 416,000 5,500 4,000 200 500

WENDOLYN Company manufactures noodles. To promote the sale of GWENDOLYN's products, premium is offered to customers who send in three wrappers and remittance of Php 25. The eight-out per premium is Php5. 2020 2021 Sales Premiums purchased at Php 80 each Number of premiums distributed Number of premiums to be distributed next period 4,000,000 400,000 5,000,000 416,000 5,500 4,000 200 500

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Assuming that premiums actually distributed is always less than management's estimates, what amount should be reported as premium expense for 2021? GWENDOLYN Company manufactures noodles. To promote the sale of GWENDOLYN's products, a premium is offered to customers who send in three wrappers and remittance of Php 25. The freight-out per premium is Php5. 2020 2021 4,000,000 5,000,000 416,000 Sales Premiums purchased at Php 80 each Number of premiums distributed Number of premiums to be distributed next period 400,000 4,000 5,500 200 500 a. 464,000 b. 348,000 c. 360,000 d. 330,000
Transcribed Image Text:Assuming that premiums actually distributed is always less than management's estimates, what amount should be reported as premium expense for 2021? GWENDOLYN Company manufactures noodles. To promote the sale of GWENDOLYN's products, a premium is offered to customers who send in three wrappers and remittance of Php 25. The freight-out per premium is Php5. 2020 2021 4,000,000 5,000,000 416,000 Sales Premiums purchased at Php 80 each Number of premiums distributed Number of premiums to be distributed next period 400,000 4,000 5,500 200 500 a. 464,000 b. 348,000 c. 360,000 d. 330,000
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