tpe connect ACCOUNTING Homework chapter 13-2 Instructions Question 2 (of 6) Save
ID: 2563008 • Letter: T
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tpe connect ACCOUNTING Homework chapter 13-2 Instructions Question 2 (of 6) Save & Exit Su 2. velue 10.00 points You did not receive full credit for this question in a previous a Cirouit Town commenced a gift card program in January 2018 and sold $13,900 of gifht cards in January, $18,700 in February, and $20,450 in March of 2016 belore discontinuing further gift card sales During 2018, git card redemptions wore $8,500 for the January gift cards sold $5,100 for the Fabruary cards, and $6,050 for the March cards Circuit Town cosids oit cards to be 'broken (not redeemable) 10 months after sale Required: 1. How much revenue will Cirouit Town rooognize with respect to Jlanuary gilt card sales during 2016? oe@.o®Explanation / Answer
1. Revenue recognized by CircuitTown for january gift card sales will be $13,900
As $8,500 of gift card was redeemed and $5,400 of gift card was broken.
3.
Revenue recognized by CircuitTown for March gift card sales will be $6,050
As $6,050 of gift card was redeemed but balance of gift card sale is still not broken as the gift card will break after 10 month of sale.
4. 14,400 of gift card sale will be shown as deferred revenue as for january and February sales all the gift cards is expired.
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