Kane Candy Company offers a coffee mug as a premium for every ten $1 camdy bar wrappers presented by customers together with $2. The purchase price of each mug to the company is $1.80 in addition it cost $1.20 to mail each mug. The results of the premium plan fir the years 2017 and 2018 are as follows (assume all purchases and sales are for cash).

2017 2018

Coffee mugs purchased. 750000. 810000

Candy bars sold. 5600000. 6980000

Wrappers redeemed. 2900000. 4230000

2017. wrappers expected

to be redeemed in 2018. 21000000

2018 wrappers expected

to be redeemed in 2019. 2730000

a. Prepare the general journal entries that should be made in 2017 and 2018 related to the above plan by Kane Candy.

b. Indicate the account names, amounts, and classifications of the items related to the premium plan that would appear on the Kane Candy Company balance sheet and income statement at the end of 2017 amd 2018.