P13-8B (Premium Entries) To stimulate the sales of its Royal Frozen dinners, King Company places 1 coupon in each box. Ten coupons are redeemable for a premium consisting of a hot meal carrier. In 2015, the company purchases 100,000 hot meal carriers at $2.25 each and sells 2,200,000 boxes of Royal Frozen dinners at $4.75 a dinner. From its experience with other similar premium offers, the company estimates that 30% of the coupons issued will be mailed back for redemption. During 2015, 230,000 coupons are presented for redemption.

Instructions: Prepare the journal entries that should be recorded in 2015 relative to the premium plan.