The premium liability at December 31, 2021 is * A.22,500.B.45,000.C.84,375D.39,375. The entity has a long -term line of creditMatthew Co. includes one coupon in each bag of dog food it sells. In return for eightcoupons, customers receive a leash. The leashes cost Matthews P3 each. Matthewestimates that 45 percent of the coupons will be redeemed.Data for 2020 and 2021 are as follows:20202021Bags of dog food soldLeashes purchasedCoupons redeemed500,000600,00018,00022,000120,000150,000

Liabilities are accumulated financial obligations that result from past events that are expected to…

Answered: SPI Matthew Co. includes one coupon in…

Business

Accounting

SPI Matthew Co. includes one coupon in each bag of dog fo coupons, customers receive a leash. The leashes cost M

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

The premium liability at December 31, 2021 is *

A.22,500.

B.45,000.

C.84,375

D.39,375.

The entity has a long -term line of credit
Matthew Co. includes one coupon in each bag of dog food it sells. In return for eight
coupons, customers receive a leash. The leashes cost Matthews P3 each. Matthew
estimates that 45 percent of the coupons will be redeemed.
Data for 2020 and 2021 are as follows:
2020
2021
Bags of dog food sold
Leashes purchased
Coupons redeemed
500,000
600,000
18,000
22,000
120,000
150,000

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