Calculate and write all journal entries for 2017 and 2018

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Question

Sterling Co. includes one coupon in each bag of dog food it sells. In return for 4 coupons, customers receive a dog toy that the company purchases for $1.50 each. Sterling's experience indicates that 60 percent of the coupons will be redeemed. During 2017, 150,000 bags of dog food were sold, 18,000 toys were purchased, and 60,000 coupons were redeemed. During 2018, 180,000 bags of dog food were sold, 24,000 toys were purchased, and 90,000 coupons were redeemed

Calculate and write all journal entries for 2017 and 2018 to record purchase of dog toys, estimated liability and redemption of coupons.

Reference no: EM132380077

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