Casey Corporation distributed coupons to promote new products. On Oct 1, 2020, the entity mailed 100,000 coupons for P 45 off each box of cereal purchased. The entity expected 12,000 of these coupons to be redeemed before the December 31, 2020 expiration date.

It takes 30 days from the redemption date for the entity to receive the coupons from the retailers. The entity reimbursed the retailers an additional P 5 for each coupon redeemed.

On December 31, 2020, the entity had paid retailers P 250,000 related to these coupons and had 5,000 coupons on hand that that not been processed for payment.

Required:

Prepare the necessary entries

What amount should be reported as liability for coupons on December 31, 2020? __________