Drink Corp. places 1 coupon in each "Panda" coffee box. Six coupons are redeemable for a premium consisting of a mug. In 2022, the company purchases 65,000 mugs at $4.00 each and sells 600,000 boxes of "Panda" at $4.50 a box. From its experience with other similar premium offers, the company estimates that 60% of the coupons issued will be redeemed. During 2022, 300,000 coupons are presented for redemption. Assume that a mug has a market fair value at $5.00. Required Prepare the journal entries that should be recorded in 2022 relative to the customer royalty program. Paolo Inc. provides a warranty with all products sold. Paolo estimates that it will sell 500,000 units of its product for the year ended December 31, 2022. It also estimates that 50% of the product will have no defects, 40% will have minor defects. 10% will have major defects, and The cost of a major defect is estimated to be $25 for each product, and the cost for a minor defect is $10. The management estimates that the minimum amount of warranty expense will be $2,000,000 and the maximum will be $5,000,000. Required Determine the amount to record as warranty provisions and prepare journal entry for 2022