CircuitTown commenced a gift card program in January 2018 and sold $13,550 of gift cards in January, $15,200 in February, and $21,750 in March of 2018 before discontinuing further gift card sales. During 2018, gift card redemptions were $8,300 for the January gift cards sold, $6,000 for the February cards, and $6,000 for the March cards. Circuit Town considers gift cards to be "broken" (not redeemable) 10 months after sale. Required: 1. How much revenue will Circuit Town recognize with respect to January gift card sales during 2018? 2. Prepare journal entries to record the sale of January gift cards, redemption of gift cards (ignore sales tax), and breakage (expiration) of gift cards. 3. How much revenue will CircuitTown recognize with respect to March gift card sales during 2018? 4. What liability for deferred revenue associated with gift card sales would CircuitTown show as of December 31, 2018? Complete this question by entering your answers in the tabs below. Reg 2 Req 1 3 and 4 Prepare journal entries to record the sale of January gift cards, redemption of gift cards (ignore sales tax), and breakage (expiration) of gift cards. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Record the redemption of January gift cards. Note: Enter debits before credits. General Journal Debit Credit Event 2 CircuitTown commenced a gift card program in January 2018 and sold $13,550 of gift cards in January, $15,200 in February, and $21,750 in March of 2018 before discontinuing further gift card sales. During 2018, gift card redemptions were $8,300 for the January gift cards sold, $6,000 for the February cards, and $6,000 for the March cards. CircuitTown considers gift cards to be "broken" (not redeemable) 10 months after sale. Required: 1. How much revenue will CircuitTown recognize with respect to January gift card sales during 2018? 2. Prepare journal entries to record the sale of January gift cards, redemption of gift cards (ignore sales tax), and breakage (expiration) of gift cards. 3. How much revenue will CircuitTown recognize with respect to March gift card sales during 2018? 4. What liability for deferred revenue associated with gift card sales would CircuitTown show as of December 31, 2018? Complete this question by entering your answers in the tabs below. Reg 2 Req 1 3 and 4 Prepare journal entries to record the sale of January gift cards, redemption of gift cards (ignore sales tax), and breakage (expiration) of gift cards. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Record the expiration of January gift cards. Note: Enter debits before credits. Event General Journal Debit Credit 3 CircuitTown commenced a gift card program in January 2018 and sold $13,550 of gift cards in January, $15,200 in February, and $21,750 in March of 2018 before discontinuing further gift card sales. During 2018, gift card redemptions were $8,300 for the January gift cards sold, $6,000 for the February cards, and $6,000 for the March cards. CircuitTown considers gift cards to be "broken" (not redeemable) 10 months after sale. Required: 1. How much revenue will Circuit Town recognize with respect to January gift card sales during 2018? 2. Prepare journal entries to record the sale of January gift cards, redemption of gift cards (ignore sales tax), and breakage (expiration) of gift cards. 3. How much revenue will CircuitTown recognize with respect to March gift card sales during 2018? 4. What liability for deferred revenue associated with gift card sales would CircuitTown show as of December 31, 2018? Complete this question by entering your answers in the tabs below. Reg 2 Req 1 3 and 4 How much revenue will Circuit Town recognize with respect to January gift card and March gift card sales during 2018. What liability for deferred revenue associated with gift card sales would CircuitTown show as of December 31, 2018? 1 Revenue recognized from January gift card sales 3 Revenue recognized from March gift card sales 4 Year-end deferred revenue liability
