Question

On September 1, Home Store sells a mower (that costs $160) for $460 cash with a one-year warranty that covers parts. Warranty expense is estimated at 12% of sales. On January 24 of the following year, the mower is brought in for repairs covered under the warranty requiring $32 in materials taken from the Repair Parts Inventory. Prepare the September 1 entry to record the mower sale (and cost of sale) and the January 24 entry to record the warranty repairs. (Round your answers to 2 decimal places.) View transaction list Journal entry worksheet < 1 2 3 4 Record the mower sales. Note: Enter debits before credits. General Journal Debit Credit Date Sep 01 Record entry Clear entry View general journal

Answer 1

Sep 1	Cash	460
	Sales revenue		460
Sep 1	Cost of Goods Sold	160
	Inventory		160
Sep 1	Warranty expense	55.20
	Estimated warranty liability		55.20
	(460*12%)
Jan 24	Estimated warranty liability	32
	Repair parts inventory		32

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