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Problem 1-1 a.) Prepare necessary entries from June 20, 2017 to December 31, 2017 b.) What is the estimated liability for premium on December 31, 2018?

Problem 1-2 a.) Prepare necessary journal entries from October 1, 2017 to December 31, 2017 b.) What amount should be reported as liability for coupons on December 31, 2017?

Problem 1-1 In an effort to increase sales, Bills Company inaugurated a sales in promotional campaign on June 20, 2017. The entity placed a coupon redeemable for a premium in each package of cereal sold. Each premium cost P20 and five coupons must be presented by a customer to receive a premium. The entity estimated that only 60% of the coupons issued would be redeemed. For the six months ended December 31, 2017, the following information is available: Packages of cereal sold 160,000 Premium purchased Coupons redeemed 12,000 40,000 Required: A. Prepare necessary entries from June 20, 2017 to December 31, 2017. B. What is the estimated liability for premium on December 31, 2018? Problem 1-2 Kiss Cereal Company distributed coupon to promote new products. On October 1, 2017, the entity mailed 100,000 coupons for P45 off each box of cereal purchased. The entity expected 12,000 of these coupons to be redeemed before December 31, 2017 expiration date. It takes 30 days from the redemption date for the entity to receive the coupons from the retailers. The entity reimbursed the retailers an additional P5 for each coupon redeemed. On December 31, 2017, the entity had paid retailers P250,000 related to these coupons and had 5,000 coupons on hand that had not been processed for payment. Required: A. Prepare necessary journal entries from October 1, 2017 to December 31, 2017. B. What amount should be reported as liability for coupons on December 31, 2017