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QuestionProblem 13-9
Sycamore Candy Company offers an MP3 download (seven-single medley) as a premium for every 5 candy bar wrappers presented by customers together with $3.10. The candy bars are sold by the company to distributors for 30 cents each. The purchase price of each download code to the company is $2.85. In addition, it costs 50 cents to distribute each code. The results of the premium plan for the years 2014 and 2015 are as follows. (All purchases and sales are for cash.)
2014 2015
MP3 codes purchased 315,000 415,800
Candy bars sold 2,959,600 2,776,000
Wrappers redeemed 1,512,000 1,890,000
2014 wrappers expected to be redeemed in 2015 365,400
2015 wrappers expected to be redeemed in 2016 441,000
Prepare the journal entries that should be made in 2014 and 2015 to record the transactions related to the premium plan of the Sycamore Candy Company. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 1,525.)
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