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Dynasty Company sells gift certificates redeemable only when merchandise is purchased. Upon redemption, Dynasty Company recognizes the unearned revenue as realized. Information for 2019 is as follows: Unearned Revenue, January 1, 2019 P650,000; Gift certificates sold P2,250,000; Gift certificates redeemed P1,950,000; Gift certificates unredeemed for a long time P100,000; Cost of Goods Sold 60%. What amount should be reported as Unearned Revenue on December 31, 2019, following the ruling by the Department of Trade and Industry that gift certificates no longer have an expiration period?
Long Live Company entered into a lease agreement for the use of a new machine on January 1, 2020. The lease agreement requires an annual payment of P1,500,000 for five years starting December 31, 2020. Long Live guaranteed a residual value of P711,090 at the end of the contract. The machine will revert to the lessor at the end of five years. The machine has an economic life of 10 years. The implicit rate for this lease is 16% where the present value of 1 for five periods is 0.4761 and the present value of an ordinary annuity of 1 is 3.2743. What is the balance of lease liability on December 31, 2020?
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- Question is on the photo. Thanks!arrow_forward5. Help me selecting the right answer. Thank youarrow_forwardcan you please help me answer these questions... Aardvark Company sells merchandise only on credit. For the year ended December 31, 2019, the following data are available: Sales (all on credit) $1,200,000 Accounts Receivable, January 1, 2019 225,000 Allowance for doubtful accounts, January 1, 2019 (credit) 15,000 Cash collections during 2019 1,050,000 Accounts written off as uncollected (default) during 2019 10,000 Determine the balance of Accounts Receivable at December 31, 2019. Assume that the company estimates bad debts at 2% of credit sales. What amount will the company record as bad debt expense for 2019? What journal entry would Aardvark prepare to record bad debt expense for 2019 (related to part 2)? Assume that the company estimates bad debts based on the aging method, and the aging schedule estimates that $30,100 of the year-end accounts receivable will be uncollected. What amount will the company record as bad debt expense for 2019? What…arrow_forward
- hh.2arrow_forwardValaarrow_forwardMOA sells gift cards that are redeemable only at its stores. The company's policy is to record the redemption amount as realized. MOA sold P1,800,000 worth of gift certificates in 2019 and redeemed P1,560,000 worth of gift certificates. The value of outstanding gift certificates as of January 1, 2019 is P520,000. The company's gross profit margin is 40%. What is the obligation for outstanding gift cards at the end of the fiscal year on December 31, 2019?arrow_forward
- On January 10, 2022, Cullumber Co. sold merchandise on account to Robertsen Co. for $16,600, n/30, On February 9, Robertsen Co. gave Cullumber Co.a 11% promissory note in settlement of this account. Prepare the journal entry to record the sale and the settlement of the account receivable. (Omit cost of goods sold entries.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Account Titles and Explanation) Date Jan 10 4 Feb. 9 # Debit Credit 1000arrow_forwardWhat amount should DanBam report as a liability for deposits on returnable containers at December 31,2019?arrow_forwardHahaarrow_forward
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