Coronado Hardware takes pride in being the shop around the corner that can compete with the big-box home improvement stores by providing good service from knowledgeable sales associates (many of whom are retired local handymen). Coronado has developed the following two revenue arrangements to enhance its relationships with customers and increase its bottom line. 1. Coronado sells a specialty portable winch that is popular with many of the local customers for use at their lake homes (putting docks in and out, launching boats, and so on). The Coronado winch is a standard-manufacture winch that Coronado modifies so it can be used for a variety of tasks. Coronado sold 55 of these winches during 2020 at a total price of $22,000, with a warranty guarantee that the product was free of any defects. The cost of winches sold is $16,000. The assurance warranties extend for a three-year period with an estimated cost of $2,100. In addition, Coronado sold extended warranties related to 26 Coronado winches for two years beyond the three-year period for $430 each. 2. To bolster its already strong customer base, Coronado implemented a customer loyalty program that rewards a customer with one loyalty point for every $10 of purchases on a select group of Coronado products. Each point is redeemable for a $1 discount on any purchases of Coronado merchandise in the following two years. During 2020, customers purchased select group products for $127,400 (all products are sold to provide a 45% gross profit) and earned 12,740 points redeemable for future purchases. The stand-alone selling price of the purchased products is $127,400. Based on prior experience with incentive programs like this, Coronado expects 12,600 points to be redeemed related to these sales. (Coronado appropriately uses this experience to estimate the value of future consideration related to loyalty points).

Prepare the journal entries for the loyalty point sales for Coronado in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round percentage allocations to two decimal places, e.g. 15.25 and final answers to 0 decimal places, e.g. 5,275.)

Account Titles and Explanation	Debit	Credit
(To record cash sales of products subject to loyalty points)