Lex Company offers its customers a pottery cereal bowl if they send in 3 boxtops from Cute Company boxes and P 1. The company estimates that 60% of the boxtops will be redeemed. In 2020, the company sold 675,000 boxes of Lex Company and customers redeemed for 330,000 boxtops receiving 110,000 bowls. If the bowls cost Lex Company P
Lex Company offers its customers a pottery cereal bowl if they send in 3 boxtops from Cute Company boxes and P 1. The company estimates that 60% of the boxtops will be redeemed. In 2020, the company sold 675,000 boxes of Lex Company and customers redeemed for 330,000 boxtops receiving 110,000 bowls. If the bowls cost Lex Company P
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Lex Company offers its customers a pottery cereal bowl if they send in 3 boxtops from Cute Company boxes and P 1. The company estimates that 60% of the boxtops will be redeemed. In 2020, the company sold 675,000 boxes of Lex Company and customers redeemed for 330,000 boxtops receiving 110,000 bowls. If the bowls cost Lex Company P 3 each, how much liability outstanding premiums should be recorded at the end of 2020?
a. P 270,000
b. P 50,000
c. P 75,000
d. P 138,000
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