Chapter 4
Current Liabilities
185
Analysis
In this question, Canada File uses a 75% redemption rate to calculate the amounts for sales
discount and redemption rewards liability. What happens if 100% of the rewards were
redeemed this year?
AP-22A (
7
)
Ricotta Company has the following selected items and balance on their trial balance at
December 31, 2017.
Accounts Payable
$9,700
Accounts Receivable
4,200
Cash
5,000
Equipment
65,000
Estimated Warranty Liability
2,500
Inventory
18,400
Prepaid Rent
8,500
Salaries Payable
6,300
Short-term Notes Payable
21,000
Unearned Revenue
8,400
