Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Johnson and Johnson (J&J) is a public company with a calendar year end. J&J manufactures toothpaste that is ultimately purchased and used by consumers. The supply chain consists of the following:
J&J launches a new toothpaste, Shiny Teeth, on September 1, 2012. In connection with this launch, J&J developed a comprehensive marketing campaign. Part of the campaign involves releasing approximately 500,000 coupons in Sunday newspapers in locations in which the new toothpaste will be sold. When a consumer redeems the coupon upon purchasing the product from a retailer, the price charged is reduced by $1. This retailer sends the coupon to a clearinghouse. J&J reimburses the retailer for the discount provided to the customer. J&J discontinues the coupons for this product on October 1, 2012. The coupons expire on October 1, 2013. J&J has not offered coupons on toothpaste before, nor have they offered coupons with a one-year expiration period. They have, however, offered coupons with a six-month expiration date on other products. These coupons had a 1.5 percent redemption rate. J&J estimates that approximately 2 percent of the toothpaste coupons will be redeemed by customers prior to the expiration date. However, J&J does not have any data on the redemption rate for coupons offered on toothpaste. J&J has sold and recognized revenue for over $2,000,000 of Shiny Teeth into the supply chain by September 30, 2012. J&J is considering how it should account for the Shiny Teeth coupon drop that took place on October 1, 2012. In doing so, J&J asks for your help. Prepare a memo addressing the following questions. Base your analysis of these questions on the relevant authoritative literature and discuss the support in that literature for your conclusions. Be sure to cite the relevant components of the Condification in your discussions. Citations are not required for journal entries. 1. What are the accounting issue(s) and the relevant components of the authoritative literature? 1) Revenue recognition a) When and How 2. When should J&J recognize the effects of the Shiny Teeth coupon drop on its financial statements? 3. What is the dollar amount of the effect of Shiny Teeth coupon drop on J&J's financial statements? 4. What would constitute "sufficient evidence" to support J&J's expected redemption rate of 2 percent? 5. What are the accounting implications if J&J's estimated redemption rate changes to 1.5 percent at a later point in time? 6. How should the effects of the Shiny Teeth coupon drop be reflected in the income statement? 7. What are the necessary journal entries?
Discuss the roles of the GASB, the FASB, and the AICPA in standards setting for G&NP organizations.
What gain or income do Sara and Jane recognize on the exchanges? What is Wren corporation's basis in the property transferred by Sara and Jane? How does wren treat the value of the services Jane renders?
What is the error in total net income for the combined three-year period resulting from the inventory errors? Explain why the understatement of inventory by $56,000 at the end of 2007 results in an understatement of equity by the same amount in th..
Derivative accounting: What are the disclosure requirements for traditional and derivative financial instruments? Should companies disclose if such instruments are used for hedging or speculation? Why?
Top executive officers of Leach Company, a merchandising firm, are preparing the next year's budget. The controller has provided everyone with the current year's projected income statement
Comment on the following items relative to tax planning strategies of a fiduciary entity.
during september the following summary transactions were completed. sept. 8 paid 1356 for salaries due employees of
The company expects to sell 20% of its merchandise for cash. Of sales on account, 70% are expected to be collected in the month of the sale, 25% in the month following the sale, and the remainder in the following month. The cash collections in Sep..
The company also makes its disbursements from remote disbursement centers so checks written by City Farm take longer to clear the bank. Collection time has been reduced by two days and disbursement time increased by one day because of these polici..
The overhead cost per unit of Product B under the traditional costing system is closest to:
recognition of concepts. jim armstrong operates a small company that books entershytainers for theaters parties
Parr, Inc. is a multidivisional corporation which has both intersegment sales and sales to unaffiliated customers. Parr should report segment financial information for each division meeting which of the following criteria?
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd