The following transactions are for Robert's Western World:
(1) In December, customers purchased $5,000 of gift cards (for goods) from Robert's.
(2) At December 31, gift cards totaling $2,200 remained unused.
(3) Robert's took a physical count of its inventory and determined the correct value of inventory should Required:
(a) Prepare journal entries for the three transactions. Ignore Cost of Goods Sold.
(b) What is reported in the 12/31 balance sheet as a result of items (1) and (2) above?
(c) What amount is reported as Inventory in the 12/31 balance sheet?

Question

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The Answer of The following transactions are for Robert's Western World:
(1) In December, customers purchased $5,000 of gift cards (for goods) from Robert's.
(2) At December 31, gift cards totaling $2,200 remained unused.
(3) Robert's took a physical count of its inventory and determined the correct value of inventory should Required:
(a) Prepare journal entries for the three transactions. Ignore Cost of Goods Sold.
(b) What is reported in the 12/31 balance sheet as a result of items (1) and (2) above?
(c) What amount is reported as Inventory in the 12/31 balance sheet?

The Following Transactions Are for Robert's Western World