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Question - JENNIE BP CORPORATION sells its products in expensive, reusable containers. The customer is charged a deposit for each container deliver and receives a refund for each container returned within two years after the year of delivery. JENNIE BP accounts for the containers not returned within the time limit as being sold at the deposit amount. Information for 2021 is as follows:
Containers held by customers at December 31, 2020, from deliveries in:
2019 P85,000
2020 240,000
Containers delivered in 2021 - P430,000
Containers returned in 2021, from deliveries in:
2019 P 57,500
2020 140,000
2021 157,000
Required -
a. How much revenue from container sales should be recognized for 2021?
b. How much is the total amount of JENNIE BP CORPORATION's liability for returnable containers at December 31, 2021?
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