Mercado Company has an arrangement with Kian Company that operates a customer loyalty program. The entity grants loyalty points of Kian Company when they spend a specified amount on purchases.

Program members can redeem their points with Kian Company. The points have no expiry date.

During 2020, the customers earned 60,000 points. the stand-alone selling price of each loyalty point is estimated at P20.

The sales during 2020 amounted to P6,800,000 based on stand-alone selling price.

According to Kian Company:

On december 31, 2020, 28,800 points have been redeemed in exchange of purchases.

In 2021, customers have redeemed 9,000 points

QUESTION:

1) How much is the initial unearned customer loyalty points to be recognized by Mercado?