Heartstrings Gift Shoppe sells an assortment of gifts for any occasion. During October, Heartstrings started a Gift-of-the-Month program. Under the terms of this program, beginning in the month of the sale, Heartstrings would select and deliver a random gift each month, over the next 12 months, to the person the customer selects as a recipient. During October, Heartstrings sold 28 of these packages for a total of $11,496 in cash.

Heartstrings Gift Shoppe sells an assortment of gifts for any occasion. During October, Heartstrings started a Gift-of-the-Month program. Under the terms of this program, beginning in the month of the sale, Heartstrings would select and deliver a random gift each month, over the next 12 months, to the person the customer selects as a recipient. During October, Heartstrings sold 28 of these packages for a total of $11,496 in cash.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter17: Advanced Issues In Revenue Recognition

Section: Chapter Questions

Problem 18E: On December 1, 2019, AwakcAllNight Inc. sells 5,000 super caffeinated candy bars to Campus Grocers....

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Heartstrings Gift Shoppe sells an assortment of gifts for any occasion. During October, Heartstrings started a Gift-of-the-Month program. Under the terms of this program, beginning in the month of the sale, Heartstrings would select and deliver a random gift each month, over the next 12 months, to the person the customer selects as a recipient. During October, Heartstrings sold 34 of these packages for a total of $12,060 in cash. For the month of October, calculate the amount of revenue that Heartstrings will recognize.
XYZ Inc offers a gift set to customers who send in $1.07 plus three coupon codes obtained from the purchase of the company's standard products. That is, a customer purchases three standard products which come with a coupon each, sends everything in along with the cheque for the amount above, and receives the gift set in the mail a few weeks later. During the year, the company acquired an adequate number of gift sets for $2.55 each using cash to meet the promotion's demand. During the year, the company sold 1,031,460 of its standard products for $4.03 each. The company estimated that 10% of the sales amount received from customers would relate to the gift set to be awarded. The company would expect 33.35% of the coupons to be sent in eventually, and, during the year, 247,550 coupons were redeemed. If the company followed IFRS using the revenue approach, how much promotion expense would be recorded for the year for the redeemed coupons? O a. $122,125 O b. $119,072 $116,018 O d. $125,178…
XYZ Inc offers a gift set to customers who send in $1.11 plus three coupon codes obtained from the purchase of the company's standard products. That is, a customer purchases three standard products which come with a coupon each, sends everything in along with the cheque for the amount above, and receives the gift set in the mail a few weeks later. During the year, the company acquired an adequate number of gift sets for $2.63 each using cash to meet the promotion's demand. During the year, the company sold 1,062,960 of its standard products for $4.15 each. The company estimated that 10% of the sales amount received from customers would relate to the gift set to be awarded. The company would expect 34.31% of the coupons to be sent in eventually, and, during the year, 255,110 coupons were redeemed. If the company followed IFRS using the revenue approach, how much unearned revenue would be shown as a liability at the end of the year for the coupons yet to be redeemed? a. $139,185 b.…
A home gods retailer offers a sales incentive program where customers receive credit towards future purchases based on the dollar amount of their purchases today. For every $10 spent, a customer receives a $1 credit to use in the next 30 days. Based upon historical trends, the firm estimates that 35% of the credits will be redeemed. In the next month, consistent with the firm’s estimate, 35% of the credits were redeemed. The entry recorded to account for the redemption of these credits (excluding the effect of the costs of sales entry): A.) Increases Liabilities, Increases Stockholders’ Equity B.) Increases Liabilities, Reduces Stockholders’ Equity C.) Reduces Liabilities, Reduces Stockholders’ Equity D.) Reduces Liabilities, Increases Stockholders’ Equity C.) No entry needed
During February, the last month of the fiscal year, Be My Valentine Ltd. sells $20,200 of gift cards. From experience, management estimates that 8% of the gift cards sold will not be redeemed by customers. In March, $4,600 of these cards is redeemed for merchandise with a cost of $2,500. In April, further $11,500 of these cards is redeemed for merchandise with a cost of $3,800. The company uses a perpetual inventory system. Also in February, Be My Valentine had $1,000 of unused gift cards that were over one year old and were not expected to be used. The amount was in line with the company's normal breakage and all other gift cards of the same age had been used. Your answer is correct. Prepare journal entries to record the transactions for February, March, and April. (Enter debit entries first followed by credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles…
Wilson Cafeteria issues gift cards, which are very popular in the small town where the restaurant is located. In a recent month, Wilson issued $4,000 in gift cards. Experience indicates that 80 percent of the cards will be redeemed before they expire. Required: What is the entry to record the estimated gift card expense? If an amount box does not require an entry, leave it blank.
During February, the last month of the fiscal year, Be My Valentine Ltd. sells $21,400 of gift cards. From experience, management estimates that 8% of the gift cards sold will not be redeemed by customers. In March, $4,600 of these cards is redeemed for merchandise with a cost of $2,500. In April, further $13,800 of these cards is redeemed for merchandise with a cost of $4,600. The company uses a perpetual inventory system. Also in February, Be My Valentine had $1,000 of unused gift cards that were over one year old and were not expected to be used. The amount was in line with the company's normal breakage and all other gift cards of the same age had been used.
The store sold 28 gift cards for $100 per card. at year-end, 23 of the gift cards are redeemed. Shamrock expects three of the cards to expire unused. Record the redemption and expected breakage revenue.
The following events occur during September: Webworks purchases supplies worth $120 on account. At the beginning of September, Webworks had 19 keyboards costing $100 each and 110 flash drives costing $10 each. Webworks has decided to use perpetual FIFO to cost its inventory. On account, Webworks purchases thirty keyboards for $105 each and fifty flash drives for $11 each. Webworks starts and completes five more Web sites and bills clients for $3,000. Webworks pays Nancy $500 for her work during the first three weeks of September. Webworks sells 40 keyboards for $6,000 and 120 flash drives for $2,400 cash. Webworks collects $2,500 in accounts receivable. Webworks pays off its salaries payable from August. Webworks pays off $5,500 of its accounts payable. Webworks pays off $5,000 of its outstanding note payable. Webworks pays Leon salary of $2,000. Webworks pays taxes of $795 in cash. Required: Prepare journal entries for the above events. Post the journal entries to T-accounts.…
On May 31, Marty’s Ice Cream Shop sells gift cards for $5,000. Customers redeem $1,200 in June, $2,100 in July, and $1,400 in August. Marty’s experience is that any unredeemed gift cards as of August 31 are not likely to be redeemed. Calculate the amount of gift card revenue each month.
G V Required information [The following information applies to the questions displayed below.] On January 1, 2021, the general ledger of ACME Fireworks includes the following account balances: Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Land Equipment Accumulated Depreciation Accounts Payable Notes Payable (6%, due April 1, 2022) Common Stock Retained Earnings Totals # 3 54,645 E D During January 2021, the following transactions occur: January purchase date. 2 Sold gift cards totaling $10,000. The cards are redeemable for merchandise within one year of the January 6 Purchase additional inventory on account, $157,000. The cost of the units sold is $78,800. January 15 Firework sales for the first half of the month total $145,000. All of these sales are on account. C $ 4 R LL JUL 10 www. 8 I ( 9 ( J K A O 0 |6 L P
Prepare journal entries to record the following transaction: Ikeo Inc. sold $100,000 of gift cards during the last 2 weeks of December 2020