Given:

Purchase price of 1 mug= 0.90 + 0.60 sf per mug = 1.50

10x of worth 50 cent candy wrapers + 1.00 = 1 mug
2015
Coffee mugs purchased 720,000
Candy bars sold 5,600,000
Wrappers redeemed 2,800,000
2015 wrappers expected to be redeemed in 2016 2,000,000
2016 wrappers expected to be redeemed in 2017

Ans: (D)
Candy bars sold 5,600,000
Wrappers redeemed 2,800,000
2,800,000

Coffee mugs purchased 720,000

Purchase price of mugs sf included 1.50
480000
Net value for redeemed mugs 0.50
Premium Expense 240000
 2016
800,000
6,750,000
4,200,000

2,700,000

6,900,000
2015 wrappers expected to be redeemed in 2016 2,000,000
4,900,000
Number of wrappers to be redeemed 10
490,000.00
Net value for redeemed mugs 0.50
245000.00