Question

IS Men Sintermediate Accounting, 170 Help System Announcements CALONATOR PRINTER VERSION 4 4 BACK Problem 13-09 (Part Level Submission) Monty offers an MP3 download (seven-single medley) as a premium for every 5 candy bar wrappers presented by customers together with $3.50. The candy bars are sold by the company to distributors for 30 cents each. The purchase price of each download code to the company is $3.25. In addition, it cost 50 cents to distribute each code. The results of the premium plan for the years 2020 and 2021 are as follows. (All purchases and sales are for cash.) MP3 codes purchased Candy bars sold Wrappers redeemed 2020 wrappers expected to be redeemed in 2021 2021 wrappers expected to be redeemed in 2022 2020 2021 360,000 475,200 2,825,000 2,546,500 1,728,000 2,160,000 417,500 504,000 ody (a) Your answer is correct. Prepare the journal entries that should be made in 2020 and 2021 to record the transactions related to the premium plan of the Monty. (If no entry is required, select "Me Entry for the accountities and enter for the amounts. Credit account titles are automatically indented when amount intered. Do not indent manually. Round answers to decimal places, ... 1,525.) Debit Credit Account Tities and Explanation 2020 Inventory of Premium 1,170,000 Cash 1,170,000 (To record the premium inventory) ch 67,500 347,500 Sales Revenue (to record thes) 1,036,800 Premium Expense 36,400 (to record the expense awared with these

Answer 1

20 20 a) Premium Eup Journal Entries Date! Account liter & Euplanation gyebebi (3)Creedt Inventory of Premium Ale 74170,000 Cash 1,179,000 | 360,000 X $ 3.25) Rowed Premium. Iusentory b) Cash 847,500 Sales Revenue 87,500 62,825.000 X 6.3) Record Sales Count 1,2861-1728.00) 1036,800 86400 Incutory of premium 1192,200 (Record Eup with the sale) d : Paremium Experie 201880 Premium liability (4177600/5)x(643. 25 23.50 ) i ( Recore Piemimo liability Iron 2021 Inventory of presmicom 1544/400 Costa 1475,200 x $3.25) 184,400 Record keemium Laventory) - Cash' (2,546,560 X 043) 763,950 Sales Revenu 763,950 (To Record sales) 9) Gosh (1512,000 - 216.00z) 1:) 296,000 ity in Permicom Exp. 87,20 Beemium Lebility 20,880 Intewory of Premium 1,404.000 (To record Eup associated with sole) 20,80 b)

Lanium Expense Bomum Liability C'est en vente pocenim Liability) 4.000 ) (325403-3.50) 25, 200 25,200 Nele 172,800 Calculated Camom Exp 2020 2021 IlbcffarReedemed / $_1728,000 $21160,000 bebappe Acquad-forladha Mp3. 5 5 No_of_A3_code 3 45,600 432900 x rhenckel parece of eachdown Code 3.25 3.25 Total fusechas cost of Mp3_codes 2,123,200 1,404,000 Postazi ( 349,600 xas)/%432.pero Xow) 26,000 Total cost 1296000 1.620,000 lay Cath secured (345726,00 X3.5P) (432000X3,10) (1209600) 11.512,000) Premium Exp of Codes issued 86, 400 10,000 y Off claims aš 12/31/20 Charged is 2020 20880 but credem in 2021 $ 87,120 Pewmism Chargeable Expo 2020 2024 Classification 46,800 421,200 Current (1170,000 -1123200) (46800+1544400-1170,000 Duet $8,400 Imentary of Przemilom Pocensioms Liability 20slo 25,200 Current (20880431 2006 2,850) Liability 412,320 Selling (87/2012 poo) Expense Pocemicom Espere 107,280 (22380784co)