(Answered) In december 2016 bowie company began including one coupon

Accounting

In December, 2016, Bowie Company began including one coupon in each package of candy and offered customers a decoder ring in exchange for $5 and five coupons. The decoder ring cost Bowie $5.30 each. Eventually, it is expected that 40% of the coupons will be redeemed. During December, Bowie sold 280,000 packages of candy and no coupons were redeemed. In its December 31, 2016 balance sheet, what amount should Bowie report as estimated liability for the coupons?

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