On January $1,$ Year $1,$ Fro$-$Yo Inc. began offering customers a cash rebate of $$5\mathrm{.}00$ if the customer mails in $10$ proof$-$of$-$purchase labels from its frozen yogurt containers. Based on historical experience, the company estimates that $20\%$ of the labels will be redeemed. During Year $1,$ the company sold $5,000,000$ frozen yogurt containers at $$1$ per container. From these sales, $800,000$ labels were redeemed in Year $1,150,000$ labels were redeemed in Year $2,$ and the remaining labels were never redeemed.

Required:

$1.$ Prepare the journal entries related to the sale of frozen yogurt and the cash rebate offer for Year $1$ and Year $2.$

$2.$ Next Level Assume that $300,000$ labels were redeemed in Year $2.$ Prepare the journal entries related to the cash rebate offer for Year $2.1.$ Prepare the necessary journal entries to record:

$1.$ The sale of Fro$-$Yo containers for cash during Year $1$

$2.$ The redemption of labels during Year $1$

$3.$ The redemption of labels during Year $2$

$4.$ The recognition of the unredeemed labels at the end of Year $2$

Year $1$ entries should be recorded in page $1,$ Year $2$ entries should be recorded in page $2.$

General Journal Instructions

All transactions on this page must be entered $($except for post ref$($s$))$ before you will receive Check My Work feedback.

PAGE $1$PAGE $2$

GENERAL JOURNAL

DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT

Record sale of Fro$-$Yo containers, the cash rebate from the redemption of labels in Year $1,$ the cash rebate from the redemption of labels in Year $2,$ and the recognition of the unredeemed labels at the end of Year $2.$

Next Level

$2.$ Assume that $300,000$ labels were redeemed in Year $2.$ Prepare the journal entries related to the cash rebate offer for Year $2.$

General Journal Instructions

All transactions on this page must be entered $($except for post ref$($s$))$ before you will receive Check My Work feedback.

PAGE $1$

GENERAL JOURNAL

DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT