Question $4-(6$ marks$)$

Wild Willy Homemade Ice Cream$/$Cr$$me Glacee fait a la majson sells premium hard ice$-$cream made from locally sourced products It has two locations in Pointe$-$Claire, QC$.$ Its' best selling flavours are rum and raisin and tiger$-$tail $($they both sound really good$).$

To promote sales, it has created a loyalty program. If a customer buys ten containers of ice$-$cream, the eleventh will be free. Each container of ice$-$cream sells for $\backslash (\backslash$$ $12\backslash ).$ In $2024,$ they sold $50,000$ containers of ice$-$cream and redeemed $1,100$ free containers. The $\backslash (\backslash$$ $12\backslash )$ sales price was determined using a $\backslash (50\backslash \%\backslash )$ markup on actual production cost before considering impacts from the loyalty promotion.

Wild Willy also expects that $\backslash (80\backslash \%\backslash )$ of potential free containers will be redeemed in the future as the loyalty card expires in three years after first purchase and nearly all customers return to the stores.

Wild Willy uses IFRS$-15$ to account for various identifiable components making up the sales revenue $($ie: revenue approach$).$

$($Hint$-$ compute real sales $\backslash$$ per container after considering effects of the free container promotion$).$

Required:

$1)$ Prepare the journal entries for $2024$ with respect to the sales, cost of sales, and loyalty program.

$2)$ Compute the amount of liability to be reported at the end of $2024$ with respect to the loyalty program.

$3)$ For this part only, assume that Wild Willy uses the expense approach $($IAS$-37)$ to account for its promotion activities. Prepare the related journal entry to record transactions for this approach.