Please show your solutions.

Miracle Company manufactures a product that is packaged and sold. Each sale is accompanied by 3 coupons to be able to purchase a plate. A plate is offered to customers sending in two coupons accompanied by a remittance if P2.

Date with respect to the premium offer are summarized below:

2020 2021

Sales @250 per unit 3 600 000 4 200 000

Purchase premium, P10 per plate 390 000 580 000

Estimated number of plates

that will be distributed 70% 80%

Premiums distributed 13 000 17 000

Distribution cost P5 per plate

a. How much is the premium expense for 2020?

b. How much is the premium liability as of December 31, 2021?