Jerry’s Jellies sells one-and two-year mail-order subscriptions for its jelly-of-the-month business. Subscriptions are collected in advance. An analysis of the recorded sales activity revealed the following:

Required:

What amount of liability for unperformed obligations should Jerry’s Jellies report on its December 31, 20X2, balance sheet?

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20X1 20X2 Subscriptions sold $510,000 $620,000 Scheduled deliveries: 20X1 $230,000 20X2 195,000 $ 190,000 20X3 85,000 250,000 20X4 180,000 $510,000 $620,000