Question
Peterson Photoshop sold $1,100 in gift cards on a special promotion on October 15, 2016, and sold $1,650 in gift cards on another special promotion
Peterson Photoshop sold $1,100 in gift cards on a special promotion on October 15, 2016, and sold $1,650 in gift cards on another special promotion on November 15, 2016. Of the cards sold in October, $110 were redeemed in October, $275 in November, and $330 in December. Of the cards sold in November, $165 were redeemed in November and $385 were redeemed in December. Peterson views the probability of redemption of a gift card as remote if the card has not been redeemed within two months. At 12/31/2016, Peterson would show a deferred revenue account for the gift cards with a balance of: $1,650. $0. $1,100. $1,485.
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