Flounder sells 20 nonrefundable $100 gift cards for 3D printer paper on March 1, 2017. The paper...
Question:
Flounder sells 20 nonrefundable $100 gift cards for 3D printer paper on March 1, 2017. The paper has a standalone selling price of $100 (cost $80). The gift card's expiration date is June 30. 2017. Flounder estimates that customers will not redeem 10% of these gift cards.
The pattern of redemption is as follows.
Redemption Total
| March 31 | 50% |
| April 30 | 80% |
| June 30 | 85% |
Prepare the 2017 journal entries related to the gift cards at March 31, April 30, and June 30.
Journal Entries:
The first step to record the accounting information starts with the recording of business events in the books of accounts in the form of journal entries. Each journal entry should have a debit and a corresponding credit of equal amount as required by the dual entry system of accounting. Journal entries are posted into ledgers and from ledgers, the trial balance is extracted.
Answer and Explanation: 1
Become a Study.com member to unlock this answer! Create your account
View this answer
Answer:
The journal entries for the year 2017 are made below:
| Date | General Journal | Debit | Credit |
| March 1 | Cash (20 cards * $100) | $2,000 | |
| Deferred Sales... |
See full answer below.
Ask a question
Our experts can answer your tough homework and study questions.
Ask a question Ask a questionSearch Answers
Learn more about this topic:
Get access to this video and our entire Q&A library
What Is a General Journal in Accounting? - Definition, Format & Examples
from
Chapter 1 / Lesson 17
18K
Learn about the general journal in accounting and see its use and purpose. Explore the format of journal entries and study a general journal accounting example.
Related to this Question
- Gift card breakage refers to: a. the inability of the company to satisfy its obligation to customers that have previously purchased gift cards. b. the point in time when gift cards expire or when the likelihood of redemption by customers is viewed as remo
- Assume F&S offers a ~'Fit 50~' coupon book with 50 prepaid visits over next year. F&S has learned that Fit 50 purchasers make an average of 40 visits before the coupon book expires. A customer purchases
- Irving Music Shop gives its customers coupons redeemable for a poster plus a Dixie Chicks CD. One coupon is issued for each dollar of sales. On the surrender of 100 coupons and $5.00 cash, the poster
- Assume F&S offers a "Fit 50" coupon book with 50 prepaid visits over the next year. F&S has learned that Fit 50 purchasers make an average of 40 visits before the coupon book expires. A customer purch
- Irving Music Shop gives its customers coupons redeemable for a poster plus a Dixie Chicks CD. One coupon is issued for each dollar of sales. On the surrender of 100 coupons and presented for redemption. Sales for the first period were $700,000, and the co
- Irwin Music Shop gives its customers coupons redeemable for a poster plus a Bo Diddley CD. One coupon is issued for each dollar of sales. On the surrender of 100 coupons and $6.00 cash, the poster and CD are given to the customer. It is estimated that 80%
- Irwin Music Shop gives its customers coupons redeemable for a poster plus a Bo Diddley CD. One coupon is issued for each dollar of sales. On the surrender of 100 coupons and $5.00 cash, the poster and
- Irwin Music Shop gives its customers coupons redeemable for a poster plus a Bo Diddley CD. One coupon is issued for each dollar of sales. On the surrender of 100 coupons and $6.00 cash, the poster and
- Johnson Lighting sold $1,000 worth of gift cards on special promotion on October 15, 2014, and sold $1,500 worth of gift cards on another special promotion on November 15, 2014. Of the cards sold in October, $100 were redeemed in October, $250 in November
- Peterson Photoshop sold $2,800 in gift cards on special promotion on October 15, 2013, and sold $4,200 in gift cards on another special promotion on November 15, 2013. Of the cards sold in October, $280 were redeemed in October, $700 in November, and $840
- At what point should revenue be recognized in each of the following independent cases? \\ Case A. For Christmas presents, a McDonald's restaurant sells coupon books for $10. Each of the $1 coupons may be used in the restaurant any time during the followin
- Nick's Fish Market purchased Maine lobster on account on October 10, 2011, for a gross price of $76,000. Nick also purchased Alaskan king crab on account on October 11, 2011, for a gross price of $36,000. The terms of both sales were 2/15, n/30. Nick paid
- In the current year, Giver holds two blocks of identical stock, both worth $1,000,000. Giver purchased the first block years ago for $50,000 and the second block more recently for $950,000. Giver plans to make an inter vivos gift of one block and retain t
- Steven C. owns a local bookstore and is stocking up for Christmas. He plans to order 500 copies of "How the Grinch Stole Christmas." The retail price is $9.99, and the publisher is offering a discount
- In Lizzie Shoes' experience, gift cards that have not been redeemed within 12 months are not likely to be redeemed. Lizzie Shoes sold gift cards for $18,000 during August of 2016. $4,000 of cards were redeemed in September of 2016, $3,000 in October, $2,5
- In Lizzie Shoes' experience, gift cards that have not been redeemed within 12 months are not likely to be redeemed. Lizzie Shoes sold gift cards for $22,200 during August 2016. $5,800 of cards were redeemed in September of 2016, $3,080 in October, $3,050
- Rachel's Beach Shoppe charges tourists to use their credit cards to purchase merchandise at the vacation store. On Monday, Rachel sold $2,500 in merchandise to tourists that used their credit cards to purchase beachwear at the store. The bank charges Rach
- Sasha Co. shipped 100,000 rebate coupons in products sold during 2005. The coupons are redeemable for $15 each. Each product is sold for $200 and has a cost of $100. Sasha anticipates that 70 percent of the rebate coupons will be redeemed. The coupons exp
- || ||a ||b ||c ||d |Sales| $150,000 | $550,000 | $38,700 | $255,700 |Sales discounts | 5,000 |17,500 | 600 |4,800 |Sales returns and allowances | 20,000 |6,000 |5,100 |900 |Cost of goods sold |79,750 | 329,589 | 24,453 | 126,
- During the 2015 holiday season, Bob, a barber, gave business gifts to 34 customers. The values of the gifts, which were not of a promotional nature, were as follows: 10 at $10 each 8 at $25 each 8 at $50 each 8 at $100 each. For 2015, what is the amount o
- Jonathan purchases a block of 10 tickets to next Saturday's Nugget's game. The tickets cost $50 each. He keeps two tickets for himself and gives the remaining tickets to his business customers. Each customer receives two tickets, and Jonathan told all of
- 6. Publicity is always paid by an organization. _ _ _ _ _ _ _ _ _ 7. Contests are consumers competing for prizes or money on the basis of skills or ability._ _ _ _ _ _ _ _ _ 8. Ariel (R) and Persil
- Camacho Trading Stamp Co. records stamp service revenue and provides for the cost of redemptions in the year stamps are sold to licensees. Camacho's past experience indicates that only 80% of the stamps sold to licensees will be redeemed. Camacho's liabil
- Henry has a newspaper stand where he sells papers for $0.50 each. The papers cost him $0.30 each, giving him a 20-cent profit on each one he sells. From past experience, Henry knows that 20% of the ti
- Q's employer provided her with the following gifts and awards: Golf shirt with employer logo valued at $40; Weekend at a spa valued at $1,000 as reward for meeting sales targets; Holiday season gift (camera) valued at $300; Gift certificate of $80 to a lo
- You purchase baseball tickets last month when the team was doing poorly. You paid $100 a non-refundable ticket. Your best friend offered you $130 for the ticket now that the team is doing well. The opportunity cost of going to the game is: a. $30 b. $10
- On March 6, 2015, the time tickets of employees at Cards by Hallmark gave the following information: ten hours for Job 22, twelve hours for Job 23, and four hours for Job 24. Employees are paid an hourly rate of $10. Required: Prepare the journal entry to
- Jonathan purchases a block of 10 tickets to next Saturday's Nugget's game. The tickets cost $50 each. He keeps two tickets for himself and gives the remaining tickets to his business customer receives two tickets, and Jonathan told all of them he would se
- Chi Omega Sorority is planning its annual Riverboat Extravaganza. The Extravaganza committee has assembled the following expected costs for the event: Dinner (per person) $7 Favors and programs (per person) 3 Orchestra 3,000 Tickets and advertising 1,400
- Marcus intends to sell his customers a special round-trip airline ticket package. He is able to purchase the package from the airline carrier for $150 per customer. The round-trip tickets will be sold for $200 each and the airline intends to reimburse Mar
- A client heard through its hot line that John, the purchases journal clerk, periodically enters fictitious acquisitions. After John creates a fictitious purchase, he notifies Alice, the accounts payab
- Bob's Discount Auto Parts receives a cash discount of 2% from Auto Warehouse if it pays an invoice within 10 days. Bob, the owner, consistently sends payments 15 to 20 days after receiving the invoice and still deducts the amount of the discount. Last wee
- An offer is terminated upon rejection by the offeree unless the: a. period of time for which the offeree agreed to keep the offer open has not yet expired. b. offeror renews the offer. c. offeree revokes the rejection. d. offeree make a counteroffer.
- Ruben intends to sell his customers a special round-trip airline ticket package. He is able to purchase the package from the airline carrier for $150 each. The round-trip tickets will be sold for $200 each and the airline intends to reimburse Ruben for an
- Q's employer provided her with the following gifts and awards: a Golf shirt with an employer logo valued at $30; a Weekend at a spa valued at $1,200 as a reward for meeting sales targets; a Holiday season gift (camera) valued at $200; Gift certificate of
- During the current year, Lance sells a tract of land for $800,000 that he had received from Gwen on March 10, 1995, when the land had a FMV of $310,000. The taxable gift was $300,000 because the annual exclusion was $10,000 in 1995. Gwen purchased the lan
- Seashore Home provides house-sitting for people while they are away on vacation. Some of its customers pay immediately after the job is finished. Some customers ask that the business send them a bill. As of the end of the year, Seashore Home has collected
- Mary is a travel agent. She intends to sell her customers a special round-trip airline ticket package. She is able to purchase the package from the airline carrier for $170 each. The round-trip tickets will be sold for $200 each and the airline intends to
- A customer charges a treadmill at Mike's Sport Shop. The price is $2000 and the financing charge is 9% per annum if the bill is not paid in 30 days. The customer fails to pay the bill within 30 days and a finance charge is added to the customer's account.
- Edwards Co. includes one coupon in each bag of dog food it sells. In return for four coupons, customers receive a dog toy that the company purchases for $1.20 each. Edward's experience indicates that 60% of the coupons will be redeemed. During 2010, 100,0
- Lucinda purchased a raffle ticket for $29. Just before the grand prize drawing, two people tried to buy her ticket. The first person offered $130, and another offered $165. What is Lucinda's opportunity cost of keeping the raffle ticket? a. $194 b. $159
- Colbert sells 3-D printer systems. Recently, Colbert provided a special promotion of zero-interest financing for 2 years on any new 3-D printer system. Assume that Colbert sells Lyle Cartright a 3-D s
- Colbert sells 3-D printer systems. Recently, Colbert provided a special promotion of zero-interest financing for 2 years on any new 3-D printer system. Assume that Colbert sells Lyle Cartright a 3-
- Melissa is a compulsive coupon clipper. She often brags about the time she purchased a cart full of groceries for $5.00, when the cost without coupons would have been $50. Discuss whether Melissa real
- Tco e Bobby Thigpen, waiter at relief stop, has been taking cash from the restaurant. Thinpen prepares a customers check from what the customer pays. Thinpen then destroys the check, and prepares a new one with different items of lower cost. He presents t
- Winterhaven school is raising money to purchase new choir robes. The cost of the robes is $8,000, so the school will need to have a profit of $8,000 from the raffle. The raffle tickets will sell for $10 each. The variable cost of the raffle ticket is $2 a
- Global Stores is downsizing and must let some employees go. Employees volunteering to leave are being offered a severance package of $126,000 cash, another $137,000 to be paid in one year, and an annu
- Customers enter the waiting line to pay for food as they leave a cafeteria on a first-come, first-served basis. The arrival rate follows a Poisson distribution, while service times follow an exponential distribution. If the average is four per minute and
- Millbridge Animal Protective Services (MAPS) is planning its spring awards dinner as a fundraising event. It is planning to charge each attendee $150. Feast Hall, the site of the dinner, will charge MAPS $5,000 for the use of its posh VIP Room and $50 per
- Shelly is having to review her A/R for her practice. She has a patient who earlier in the year was written off as a bad debt. That patient has now paid on the bad debt and she now has to record it. Shelly wants to minimize these types of transactions and
- The following pertain to Joyce in 20X14: Medical Insurance premiums paid by employer $4,803 Teacher of the Year Award, in the form of gift cards redeemable at local businesses $500 ewelry box, receiv
- In 2020, Bob's mother gave Bob a used car for his birthday. Bob's mother purchased the car in 2012 for $35,000. On the date of the gift, the car had an FMV of $20,000. What is Bob's gross income from the receipt of the car?
- Jessica orally agrees that she will sell 400 pairs of flip-flops to a customer for $600. What is this agreement? A.unenforceable because of the statue of frauds B. unenforceable because of the parol evidence rule C. enforceable because all necessary ele
- For 20Y2, Tri-Comic Company initiated a sales promotion campaign that included the expenditure of an additional $18,000 for advertising. At the end of the year, Lumi Neer, the president, is presented with the following condensed comparative income stateme
- Mary is a travel agent. She intends to sell her customers a special round-trip airline ticket package. She is able to purchase the package from the airline carrier for 170 euros each. The round-trip tickets will be sold for 200 euros each and the airline
- Three years ago, Marissa Moore started a business that creates and delivers holiday and birthday gift baskets to students at the local university. Marissa sells the baskets for $29 each, and her variable costs are $19 per basket. She incurs $12,100 in fix
- In December, 2016, Bowie Company began including one coupon in each package of candy and offered customers a decoder ring in exchange for $5 and five coupons. The decoder ring cost Bowie $5.30 each. Eventually, it is expected that 40% of the coupons will
- Marie Janes encounters the following situations in doing the audit of a large auto dealership. Janes is not a partner. 1. The sales manager tells her that there is a sale (at a substantial discount)
- George wants to sell toy rockets at the state fair. He can purchase these rockets at $0.50 each and can return all unsold rockets for a refund. He will be required to rent a booth from which he can sell the rockets at a flat rate of $200, payable in advan
- Adam Weiss, President of PRP Company, incurred the following entertainment expenses that were reimbursed by the company under its accountable plan. Dinner meetings with clients = $14,000 Theater tickets where business was discussed after the show = $300 D
- Lucinda purchased a raffle ticket for $21. Just before the grand prize drawing, two people tried to buy her ticket. The first person offered $90, and another offered $125. What is Lucinda's opportunity cost of keeping the raffle ticket? A. $42. B. $111. C
- The following book and fair values were available for Plymouth, Inc. as of March 1. Book ValueFair Value Inventory$260,500$229,750 Land759,0001,069,500 Buildings2,170,0002,535,250 Customer relationshi
- Suppose the Baseball Hall of Fame in Cooperstown, New York, has approached Hungry-Cardz with a special order. The Hall of Fame wishes to purchase 55,000 baseball card packs for a special promotional campaign and offers $0.33 per pack, a total of $18,150.
- Janice is the buyer for a retail-clothing store. Her store has a policy of not accepting gifts. However, over the years, salesmen have offered, and other employees have accepted lunch, theater, and baseball tickets. Janice arrives home from the office and
- On April 26, Kindler Welding Corp. purchased $8,640 worth of welding supplies from a wholesaler that offered terms of 1.75/7, net/30. The discount applies to any amount paid within the discount period. What is the unpaid balance if Kindler paid $6,000 on
- Amy receives a painting from her mother, Sandy, as a gift. Sandy's adjusted basis in the painting is $200,000. At the time of the gift, the painting is worth $350,000. Sandy paid $30,000 in a gift tax. What is Amy's basis in the painting?
- Mary is a sales person for Four Paws Pet Supply. She receives an incremental commission based on the table below. If she sells $9,800 and has already received a draw of $559.26, how much commission is still owed to Mary?
- Jani Subramanian, owner of Jani's Flowers and Gifts, produces gift baskets for various special occasions. Each gift basket includes fruit or assorted small gifts (e.g., a coffee mug, deck of cards, no
- Tom's Wear purchased plain T-shirts and printed logos on the T-shirts in January. The T-shirts were sold to customers in February. Tom's Wear received the final cash payments from the customers in March. According to the realization principle, when shoul
- In an automated payroll processing environment, a department manager substituted the time card for a terminated employee with a time card for a fictitious employee. The fictitious employee had the same pay rate and hours worked as the terminated employee.
- Three years ago, Marissa Moore started a business that creates and delivers holiday and birthday gift baskets to students at the local university. Marissa sells the baskets for $28 each, and her variable costs are $18 per basket. She incurs $12,500 in fix
- Atlas Co. allows select customers to make purchases on credit. Its other customers can use either of two credit cards: Zisa or Access. Zisa deducts a 3% service charge for sales on its credit card and credits the bank account of Atlas immediately when cr
- A taxpayer owns and operates an art gallery with a large inventory of paintings held for sale to customers. She took one of the paintings home and hung it in her dining room. A week later, a dinner guest liked the painting so much that he purchased it at
- Suppose the Baseball Hall of Fame in Cooperstown, New York, has approached SportCardz with a special order. The Hall of Fame wishes to purchase 50,000 baseball card packs for a special promotional campaign and offers $.35 per pack, a total of $17,500. Spo
- Tyler borrowed $3,500 to purchase a machine. He later borrowed $1,500 using the machine as collateral. Both notes are nonrecourse. Ten years later, the machine has an adjusted basis of zero and two outstanding note balances of $2,000 and $600. Tyler sells
- Suppose that Mark and Charlie had agreed on the deal, and Mark wrote the terms of the sale on the back of an envelope, which both signed. They planned on hiring an attorney to "flesh out" the agreemen
- Elmore Eisner made the following contributions during the current tax year: Cash to United Way $5,000 Land to Boy Scouts to be used as a summer camp: Cost 20,000 Fair market value 30,000 Painting to a
- Your grandmother has promised to give you $5,000 when you graduate from college. She is expecting you to graduate two years from now. What happens to the present value of this gift if you delay your graduation by one year and graduate three years from now
- George took a customer to dinner where they discussed business and then went to see a play. He spent $120 for the meal and left a $25 tip. Cab fare to the theater was $10 and George paid a scalper $200 for the two play tickets with a face value of $80 eac
- Mike returned $200 of merchandise to Secret Trails. His original purchase was $400, with terms 1/10, n/30. If Mike pays the balance of his account after the discount period, how much should he pay? A. $200 B. $204 C. $400 D. $196
- The owner of Westhampton Fish Eatery purchased a new car for his daughter who is away at college at a cost of $43,000 and reported this amount as Delivery Vehicle in the restaurant's balance sheet. The reporting of this item in this manner violated the
- Jim purchases a ticket for $80 for a special concert by the symphony (a qualified charity). If the price of a ticket is normally $25, what is the amount allowed as a charitable deduction? a) $80 b)
- The O'Neil Theater offered books of theater tickets to its patrons at $30 per book. Each book contained a certain number of tickets to future performances. During the current period 1,000 books were sold for $30,000, and this amount was credited to a temp
- Mac arranges financing for a load of contraband weapons he plans to sell to the rebels. The terms of the loan are as follows: The bank will provide Mac $46,000 today. Each year, for the next 37 years, Mac must pay the bank $5,600. Mac has a real discount
- Atlas Co. allows select customers to make purchases on credit. Its other customers can use either of two credit cards: Zisa or Access. Zisa deducts a 4.0% service charge for sales on its credit card and credits the bank account of Atlas immediately when c
- After Jeremy has made his sales presentation and answered the prospect's objections, he says, "When would you like to take delivery of the copier? This is called a: a. follow-up b. clincher c. slick seller d. trial closing e. negotiation for delivery
- Suppose the Baseball Hall of Fame in Cooperstown, New York, has approached Tiger - Cardz with a special order. The Hall of Fame wishes to purchase 57,000 baseball card packs for a special promotional campaign and offers $0.32 per pack, a total of $18,240.
- Beth uses all her income from working to purchase oysters, the only thing she enjoys apart from leisure. A plate of oysters costs $25.00, and she can work up to 8 hours a day at an hourly wage of $9.0
- Steve has just returned from salmon fishing. He was lucky on this trip and brought home 2 salmon. Steve's wife, Wendy, disapproves of fishing, and to discourage Steve from further fishing trips, she has presented him with the following cost data. The cost
- J James Book Publishers is trying to decide whether to offer a 3 cash discount for payments made within 10 days making its new terms 310 net 30
- You thought that things had settled down after you left the meeting during which the managers had discussed bad debts and sales discounts. However, when you arrived today there was another heated disc
- Amy makes the following gift in the year 2016: Gift of a personal automobile valued $40,000 to her adult son. A. $40,000 is taxable because you cannot gift money to your child. B. Only $26,000 is taxed due to the $14,000 annual gift exclusion. C. None is
- Suppose the Baseball Hall of Fame in Cooperstown, New York, has approached Sports-Cardz with a special order. The Hall of Fame wishes to purchase 51,000 baseball card packs for a special promotional campaign and offers $0.44 per pack, a total of $22,440.
- On July 1, Pam's Pizza Supply sold 100 pounds of pepperoni for $800 on account to a local pizza parlor. The terms of the sale were 2/10, n/30. The pizza parlor paid Pam's Pizza Supply in full on July 7. Prepare the entries that Pam would make to record th
- Nigel received a Land Rover from his mother as a gift. His mom had purchased the Land Rover two years earlier for $65,000, but its fair market value at the date that she made the gift to him was only $50,000. No gift tax was paid by his mom at the time of
- Pete Sazich, the accountant for Moore Company, feels that all bad debts will be eliminated if credit transactions are done by credit card. He also feels that the cost of the credit cards should be added to the price of the goods. Pete feels that in the fu
- During the current year, Paul, the vice president of a bank, made gifts in the following amounts: In addition, on professional assistants' day, Paul takes Sarah to lunch at a cost of $82. Presuming
- A purchasing agent for Westgate Wireless receives the goods that he purchases and also approves payment for the goods. How could this purchasing agent cheat his company?
- A student owes the bookstore $900 and doesn't have the money to pay the full balance. The college offers two payment options: 1. Pay $300 today and $700 in two years. 2. Pay $1,200 three years from today. Assuming the cost of money is 8% compounded ann
- Three years ago, Barbara donates a painting that cost $7,000, to a university for display in the president's office. The fair market value of the painting on the date of the gift is $14,000. If Barbara had sold the painting, the difference between the sal
Explore our homework questions and answers library
Browse
by subject