Problem 2 8
Problem 2 8
Problem 2 8
buy clothing with a single purchase of at least P4,000, the entity shall issue "40 discount
coupons" on selected items.
The coupons may be used for 2 months following the campaign. During the campaign, the
entity sold clothing worth P1,860,000 and issued 100 "40% discount coupons".
The entity expected that 70% of the coupons will be redeemed and customers using the
coupons buy clothing at an average price of P5,000.
Required:
1. Compute the stand-alone price of the discount coupons.
Average price of future purchases P 5,000
2,000,000 1,860,000
3. Prepare the journal entry to recognize the sale of the products and issue of
discount coupons.
Cash P 1,860,000
Sales P 1,729,800
Deferred revenue – coupons 130,200
Cash P 210,000
Deferred revenue – coupons 130,200
Sales P 340,200
Total amount of future purchases P 500,000
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