Novak Corp. offers its customers a 5-piece knife set in exchange for $9 and the purchase of its CC Cookware set. The company purchased 2,850 units of the 5-piece knife sets at $15 each. It estimates that 70% of customers will participate in the promotion and that 5% of the amount received from customers relates to the awarded premiums. In 2024, the company sold 4,020 cookware sets at sales price of $116 resulting in sales revenue of $466,320. By the end of the year, 2,330 customers took advantage of the promotion. Prepare the appropriate journal entries assuming Novak follows IFRS and uses the revenue approach. Ignore any cost of goods sold entry. (Do not round intermediate calculations. Round answers to 0 decimal places, e.g. 5,125. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If now entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Inventory of Premiums Cash (To record purchase of premiums) Cash Sales Revenue Debit 42750 Credit 42750 111

Novak Corp. offers its customers a 5-piece knife set in exchange for $9 and the purchase of its CC Cookware set. The company purchased 2,850 units of the 5-piece knife sets at $15 each. It estimates that 70% of customers will participate in the promotion and that 5% of the amount received from customers relates to the awarded premiums. In 2024, the company sold 4,020 cookware sets at sales price of $116 resulting in sales revenue of $466,320. By the end of the year, 2,330 customers took advantage of the promotion. Prepare the appropriate journal entries assuming Novak follows IFRS and uses the revenue approach. Ignore any cost of goods sold entry. (Do not round intermediate calculations. Round answers to 0 decimal places, e.g. 5,125. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If now entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Inventory of Premiums Cash (To record purchase of premiums) Cash Sales Revenue Debit 42750 Credit 42750 111

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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