What amount should jackpine report as a liability

Assignment Help Financial Accounting
Reference no: EM132467407

Jackpine Trading Stamp Co. records trading stamp revenue and provides for the cost of redemptions in the year stamps are sold. Jackpine's past experience indicates that only 75% of the stamps sold will be redeemed. Jackpine's liability for stamp redemptions was $ 3,000,000 at December 31, 2019. Additional information for 2020 is as follows:

Stamp revenue from stamps sold to licensees                     $ 2,000,000

Cost of redemptions for stamps sold prior to 2020              1,350,000

Question problem 1: If all the stamps sold in 2020 were presented for redemption in 2020, the redemption cost would be $ 1,000,000. What amount should Jackpine report as a liability for stamp redemptions at December 31, 2020?

a) $ 3,750,000

b) $ 2,650,000

c) $ 2,400,000

d) $ 1,650,000

Reference no: EM132467407

Questions Cloud

Compute the approximate cost of new common stock : What is the immediate dilution potential for this new stock issue? (Do not round intermediate calculations and round your answer to 2 decimal places.)
Determine technical engineering variable cost per copy : Paid a total of $162 in rent in September and in October they paid $195 for 3500 copies. Determine Technical Engineering's variable cost per copy.
Discuss formulate a schedule of note discount amortization : Formulate a Schedule of Note Discount Amortization for Omega Corp under the effective interest method. (Round to whole dollars.)
How much return will investment earn : How much return will his investment earn during this time period?What will the after-tax cost of debt be when the loan is due if new loan is taken out yielding
What amount should jackpine report as a liability : The redemption cost would be $ 1,000,000. What amount should Jackpine report as a liability for stamp redemptions at December 31, 2020
Determine an optimum marketing strategy : How would you set up an excel model to determine an optimum marketing strategy to maximize total exposures?determine the next month's web marketing plan
What was the mpc : Suppose consumers' disposable income increased by $350 billion and their spending increased by $325 billion. What was the MPC?
Determine the budgeted amounts of allocation bases : Determine the Budgeted amounts of allocation bases , rather than actual amounts, are preferable allocation bases because when actual amounts are used behaviour
Discuss the type of adjustment : Discuss the type of adjustment (prepaid expense, unearned revenue, accrued revenue, or accrued expense) and the status of the accounts before adjustment

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd