Exercise 10-8 Loyalty program journal entries, balance sheet impact LO2

Real People Sporting (RPS) Co-op introduced a loyalty program in 2020. Every customer who signed up would receive 3% of their total purchases as a cheque, each February for the previous year, that could be used in-store on any merchandise within the next nine months. Customers could look online during the year and check their balance at any time. Laura signed up for the program in 2020, when she purchased a kayak in July for $1,000. Later, in September, she purchased a mountain bike for $2,000. In March 2021, she purchased a paddle board for $1,900 and used her cheque toward the purchase.

Journal entry worksheet Record the sale of kayak and loyalty points. Note: Enter debits before credits. Debit Credit Date Jul, 2020 1,000 General Journal Cash Rewards Points Liability Sales Revenue 30 970 Record entry Clear entry View general journal Journal entry worksheet 1 2 3 Record sale of mountain bike and loyalty points. Note: Enter debits before credits. Credit Date Sep, 2020 Debit 2,000 General Journal Cash Sales Revenue Sales discount for redemption of Rewards Points Rewards Points Liability 2,000 60 60 Record entry Clear entry View general journal Journal entry worksheet Record the sale of paddle board, use of rewards points' cheque towards its purchase, and the rewards points earned on sale. Note: Enter debits before credits. Debit Credit Date Mar, 2021 1,810 90 General Journal Cash Rewards Points Liability Sales Revenue Sales discount for redemption of Rewards Points Rewards Points Liability 1,900 57 57 Record entry Clear entry View general journal