Bavarian Bar and Grill opened for business in November $2024.$ During its first two months of operation, the restaurant sold gift cards in

various amounts totaling $$7,400,$ mostly as Christmas presents. They are redeemable for meals within two years of the purchase date,

although experience within the industry indicates that $80\%$ of gift cards are redeemed within one year. Gift cards totaling $$2,400$ were

presented for redemption during $2024$ for meals having a total price of $$2,800.$ The sales tax rate on restaurant sales is $4\%,$ assessed

at the time meals $($not gift cards$)$ are purchased. Sales taxes will be remitted in January.

Required:

Prepare the appropriate journal entries $($in summary form$)$ for the gift cards and meals sold during $2024($keeping in mind that, in

actuality, each sale of a gift card or a meal would be recorded individually$).$

Determine the liability for gift cards to be reported on the December $31,2024,$ balance sheet.

What is the appropriate classification $($current or noncurrent$)$ of the liabilities at December $31,2024?$