What is the premium expense for the current year? * Sisiw Company offers a pottery bowl if they send four boxtops from its products and Php5. Sisiw Company estimated that 50% of the boxtops will be redeemed. During the current year, the entity sold 800,000 boxes and customers redeemed 350,000 boxtops. The cost of each bowl is Php30 plus a distribution cost of Php15.

What is the premium expense for the current year? * Sisiw Company offers a pottery bowl if they send four boxtops from its products and Php5. Sisiw Company estimated that 50% of the boxtops will be redeemed. During the current year, the entity sold 800,000 boxes and customers redeemed 350,000 boxtops. The cost of each bowl is Php30 plus a distribution cost of Php15.

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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JIN Corporation started a promotional program. A towel is offered as a premium to customers who send in 10 box tops of facial soap returned and remittance of ₱25. The distribution cost is ₱10 per towel. The entity estimated that only 60% of the box tops reaching the market will be redeemed. The entity provided the following information: 2020 2021 Facial soap sales, ₱50 per unit ₱ 2,500,000 ₱ 2,875,000 Towel purchases, ₱90 per unit ₱ 337,500 ₱ 360,000 Number of box tops returned 22,500 38,550 Requirements: 1. Compute for the premiums (as an asset) amount for the year ended:A. December 31, 2020B. December 31, 2021 2. Compute for the premiums expense for the year ended:A. December 31, 2020B. December 31, 2021 3. Compute for the premium liability for the year ended:A. December 31, 2020B. December 31, 2021 4. How much net cash did the entity receive (give) with regards to the premium transactions for the year given below? (if net cash outflow,…
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