Required: explain treatment of the following information and show which accounts on the balance sheet are affected

b. Walbash sold 1000 software packages for $300 each on credit (ignore cost of goods sold). With each software package, Walbash offered a premium in the form of a USB drive for the return of one proof of purchase. The offer expires June 30, 2017. The cost of each USB drive is $5 and Walbash estimates that 80% of the premiums will be redeemed. In 2016, 540 premiums were redeemed.

Walbash Company Balance Sheet December 31,2016 Liabilities Current Liabilities sets t Assets S 3,800 Accounts Payable 19,400 4.100 7,200 4,000 Receivable 18,500 Accrued Wages Income Tax Payable Mortgage Payable Less: Allow ance for Doubtful Accounts nventory Sale Securities 17,800 30,500 4,800 Long Term Liabilities Mortgage Payable 16,000 40,000 Dray Company Bonds 9,000 Bonds Payable Property, Plant & Equipment Building Less: Accumulated Depreciation Equipment Less: Accumulated Depreciation Total Liabilities 90,700 83,400 21,000 29,600 13,000 42,400 18,00 Stakeholders Equity 12,000 Common Stock S 11,000 Additional Paid in Capital - Common Preferred Stock Additional Paid in Capital - Preferrec Retained Earnings Premium on Bond Payable Security for Sale Less: Treasury Stock 14,700 S 25,700 Intangible Assets Patent Less: Amortization Tredemarks 8,000 2,400 8,200 2300 8,400 37,800 5,900 3,700 4,300 1,100 1,800 Other Assets Prepaid Insurance Sinking Fund 3,600 4 2,900 7,000 10,000 Notes Recaivable Total Assets S 166 200 Total Liabilities & Stakeholders Equity S 168,200 Contingent Liability SPA Fine (b.) 50,000