62138 Prepaid Catalog Costs 62138 Retained Earnings 62138 Catalog Expenses

62138 prepaid catalog costs 62138 retained earnings

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-62,138 Prepaid Catalog Costs = -62,138 Retained Earnings - +62,138 Catalog Expenses = -62,138 c. Recognize expiration of advertising credits. -336 Advertising Credits Receivable = -336 Retained Earnings - +336 Expense: Expiration of Advertising Credits = -336 d1. Sales of gift certificates. +19,175 Cash = +19,175 Unearned Gift Certificate Revenues - = d2. Recognize sales using gift certificates. = - 18,230 Unearned Gift Certificate Revenues +18,230 Retained Earnings +18,230 Gift Certificate Revenues - = +18,230 ©Cambridge Business Publishers, 2011 Solutions Manual, Chapter 3 3- 123
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Journal Entries: a1. Prepaid catalog costs (+A) 62,550 Cash (-A) 62,550 To record catalog printing costs. a2. Advertising credits receivable (+A) 849 Advertising credits revenue (+R, +SE) 849 To recognize advertising credits earned. b.Catalog expense (+E, -SE) 62,138 Prepaid catalog costs (-A) 62,138 To regognize catalog expense ($3,894 + $62,550 - $4,306). c.Advertising credit expiration expense (+E, -SE) 336 Advertising credits receivable (-A) 336 To record the expiration of advertising credits ($21 + $849 - $534). Advertising credits expire either because they were used to advertise or, if there was a time limitation to their use, the time limit expired. d1. Cash (+A) 19,175 Unearned gift certificate revenues (+L) 19,175 To recognize gift certificates sold but not yet redeemed. d2. Unearned gift certificate revenues (-L) 18,230 Gift certificate revenues (+R, +SE) 18,230 To recognize revenues based on redeemed gift certificates ($6,108 +$19,175 - $7,053) . ©Cambridge Business Publishers, 2011 3- 124 Financial Accounting, 3 rd Edition
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