What amount should stc report as estimated liability

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Problem 1: Introduced a new toy figure called ToiMan. In order to promote the sales of this toy, STC began including one coupon with each unit it sells. For $50 and five coupons, it offered customers one ZoomKar, a favorite and fast selling electronic toy. The ZoomKar costs STC $52 each. Eventually, it is expected that 30% of the coupons will be redeemed. During December, 2018, STC sold 4,600,000 units of ToiMan. Assume the coupon was valid for one year from the month it was issued and that no coupons were redeemed during the month. In its December 31, 2018 balance sheet, what amount should STC report as estimated liability for the coupons?

a. $14,352,000.

b. $552,000.

c. $1,840,000.

d. $47,840,000.

e. None of the above answers.

Reference no: EM132677751

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