In packages of its products, Wolf Corp. includes coupons that may be presented at retail stores to obtain discounts on other Wolf products. Retailers are reimbursed for the face amount of coupons redeemed plus 10% of that amount for handling costs. Wolf honors requests for coupon redemption by retailers up to 3 months after the consumer expiration date. Wolf estimates that 30% of all coupons issued will ultimately be redeemed. Information relating to coupons issued by Wolf during 2014 is as follows.
Consumer expiration date ............... 12/31/10
Total face amount of coupons issued .......... $500,000
Total payments to retailers as of 12/31/14 ....... 115,000
What amount should Wolf report as a liability for unredeemed coupons at December 31, 2014?

Answer rating: 100% (QA)

Total coupons issued 500000 Redemption rat... View the full answer