Prepare the journal entries for cash sales

Reference no: EM133654995

Question: To increase sales, Cullumber Inc., a public company following IFRS, implemented a customer loyalty program that rewards a customer with one loyalty point for every $25 of merchandise purchased. Each point is redeemable for a $3.00 discount on any purchases of Cullumber merchandise in the next three years. After the program launched, during 2023, customers bought merchandise for $252,500 (all products are sold to provide a 30% gross profit) and earned 10,100 points redeemable for future purchases. The standalone selling price of the merchandise sold is $252,500. Based on prior experience with incentive programs like this, Cullumber expects 7,200 points to be redeemed related to these sales.

Prepare the journal entries for cash sales including the issuance of loyalty points for Cullumber in 2023.

Reference no: EM133654995

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