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Klio2033 [76]
3 years ago
9

CircuitTown commenced a gift card program in January 2018 and sold $12,900 of gift cards in January, $19,950 in February, and $1

9,800 in March of 2018 before discontinuing further gift card sales. During 2018, gift card redemptions were $8,400 for the January gift cards sold, $5,700 for the February cards, and $5,550 for the March cards. CircuitTown considers gift cards to be "broken" (not redeemable) 10 months after sale. Required: 1. How much revenue will CircuitTown recognize with respect to January gift card sales during 2018
Business
1 answer:
MatroZZZ [7]3 years ago
8 0

Answer: $12,900

Explanation:

Given that,

sold gift cards in January = $12,900

sold gift cards in February = $19,950

sold gift cards in March = $19,800

During 2018, gift card redemptions were:

January = $8,400

February = $5,700

March = $5,550

Revenue recognized in 2018 with respect to January gift card sales:

= Gift card redemption in January + Gift card breakage

= $8,400 + ($12,900 - $8,400 )

= $8,400 + $4,500

= $12,900  

Out of this $8,400 will be gift card redemption and $4,500 gift card breakage.

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Answer:

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Explanation:

In case a company has cumulative preference shares then the company has to pay preference dividend in arrears

Here, preference dividend was not paid in the year 2017

Preference dividend for 2017 = 500 \times $100 \times 4%

= $2,000

Since the dividend is paid in between the year 2018, dividend is paid for the year 2017 and not for 2018 thus preference dividend is for a year, only for 2017

Therefore, dividend to common equity = $35,000 - $2,000 = $33,000

Dividend per share = $33,000/6,000 = $5.50 per share

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