What effect if any do the coupon sales and redemptions have on the liabilities on the March 31
QUESTION
Journal entries for coupons. Morrisons Cafeteria sells coupons that customers may use later to purchase meals. Each coupon book sells for $25 and has a face value of $30; that is, the customer can use the book to purchase meals with menu prices of $30. On January 1, 2008, redeemable unused coupons that Morrisons had sold for $4,000 were outstanding. Cash inflows during the next three months appear in the following table:
March
February
January
Cash-Paying Customers
ANSWER:
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