Delta Company includes a one-year limited warranty on all products that is sells. The warranty covers...
Delta Company includes a one-year limited warranty on all products that is sells. The warranty covers the replacement or repair of defective products. On December 31, 2020, the company incurred $3,000 in costs to repair a product under the warranty. The journal entry to record this event would include: Question 4 options: debit to Warranty Liability of $3,000 credit to Warranty Liability of $3,000 debit to Warranty Expense of $3,000 credit to Warranty Expense of $3,000
Homework Answers
| The journal entry to record this event would include: |
| debit to Warranty Liability of $3,000 |
| credit to Cash of $3,000 |
| Option A is correct |
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Delta Company includes a one-year limited warranty on all
products that is sells. The warranty covers...
Coronado Company sells a machine for $7,080 with a 12-month warranty agreement that requires the company...
Coronado Company sells a machine for $7,080 with a 12-month
warranty agreement that requires the company to replace all
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customers. With sales being made evenly throughout the year, the
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Exercise 11-05 a-c Sheridan Company sells automatic can openers under a 75-day warranty for defective merchandise....
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Warranty Expenses A company sells its product subject to a warranty that covers the cost of...
Warranty Expenses A company sells its product subject to a warranty that covers the cost of parts for repairs during the six months after the date of sale. Warranty costs are estimated to be 6% of sales. Sales for June were $450,000. During the month of June, the company performed warranty work and used $12,000 of parts to perform the warranty work. 1. Prepare the journal entry to record the warranty expense for the month of June. The company uses...
Cullumber Manufacturing sells its products with a 75-day warranty for defective merchandise. Based on past experience,...
Cullumber Manufacturing sells its products with a 75-day warranty for defective merchandise. Based on past experience, Cullumber estimates that 3% of the units sold will become defective during the warranty period. Management estimates that the average cost of replacing or repairing a defective unit is NT$13 (amounts in thousands). The units sold and units defective that occurred during the last 2 months of 2020 are as follows. Month Units Sold Units Defective Prior to December 31 630 November December 28,000...
Waterway Company sells a machine for $6,660 with a 12-month warranty agreement that requires the company...
Waterway Company sells a machine for $6,660 with a 12-month warranty agreement that requires the company to replace all defective parts and to provide the repair labor at no cost to the customers. With sales being made evenly throughout the year, the company sells 620 machines in 2020 (warranty expense is incurred half in 2020 and half in 2021). As a result of product testing, the company estimates that the warranty cost is $277 per machine ($118 parts and $159...
Indigo Company sells a machine for $6,970 with a 12-month warranty agreement that requires the company...
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Kingbird Company sells a machine for $6,840 with a 12-month warranty agreement that requires the company...
Kingbird Company sells a machine for $6,840 with a 12-month warranty agreement that requires the company to replace all defective parts and to provide the repair labor at no cost to the customers. With sales being made evenly throughout the year, the company sells 620 machines in 2017 (warranty expense is incurred half in 2017 and half in 2018). As a result of product testing, the company estimates that the warranty cost is $384 per machine ($170 parts and $214...
On September 11, 2016. Home Store sells a mower for $540 with a one-year warranty that...
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Rotary Tools sells power tools and backs each product it sells with a one-year warranty against...
Rotary Tools sells power tools and backs each product it sells with a one-year warranty against defects. Based on previous experience, the company expects warranty costs to be approximately 4% of sales. By the end of the first year, sales are $900,000. Actual warranty expenses incurred so far are $13,000. 1. Does this situation represent a contingent liability? OYes No 2. & 3. Record the appropriate journal entries for the warranties. (If no entry is required for a particular transaction/event,...
Bramble Company sells a machine for $7,080 with a 12-month warranty agreement that requires the company...
Bramble Company sells a machine for $7,080 with a 12-month warranty agreement that requires the company to replace all defective parts and to provide the repair labor at no cost to the customers. With sales being made evenly throughout the year, the company sells 580 machines in 2017 (warranty expense is incurred half in 2017 and half in 2018). As a result of product testing, the company estimates that the warranty cost is $430 per machine ($190 parts and 5240...
Coronado Company sells a machine for $7,080 with a 12-month
warranty agreement that requires the company to replace all
defective parts and to provide the repair labor at no cost to the
customers. With sales being made evenly throughout the year, the
company sells 580 machines in 2020 (warranty expense is incurred
half in 2020 and half in 2021). As a result of product testing, the
company estimates that the warranty cost is $430 per machine ($190
parts and $240...
Exercise 11-05 a-c Sheridan Company sells automatic can openers under a 75-day warranty for defective merchandise. Based on past experience, Sheridan estimates that 4% of the units sold will become defective during the warranty period. Management estimates that the average cost of replacing or repairing a defective unit is $15. The units sold and units defective that occurred during the last 2 months of 2020 are as follows. Month November December Units Sold 31,200 33,200 Units Defective Prior to December...
Warranty Expenses A company sells its product subject to a warranty that covers the cost of parts for repairs during the six months after the date of sale. Warranty costs are estimated to be 6% of sales. Sales for June were $450,000. During the month of June, the company performed warranty work and used $12,000 of parts to perform the warranty work. 1. Prepare the journal entry to record the warranty expense for the month of June. The company uses...
Cullumber Manufacturing sells its products with a 75-day warranty for defective merchandise. Based on past experience, Cullumber estimates that 3% of the units sold will become defective during the warranty period. Management estimates that the average cost of replacing or repairing a defective unit is NT$13 (amounts in thousands). The units sold and units defective that occurred during the last 2 months of 2020 are as follows. Month Units Sold Units Defective Prior to December 31 630 November December 28,000...
Waterway Company sells a machine for $6,660 with a 12-month warranty agreement that requires the company to replace all defective parts and to provide the repair labor at no cost to the customers. With sales being made evenly throughout the year, the company sells 620 machines in 2020 (warranty expense is incurred half in 2020 and half in 2021). As a result of product testing, the company estimates that the warranty cost is $277 per machine ($118 parts and $159...
Kingbird Company sells a machine for $6,840 with a 12-month warranty agreement that requires the company to replace all defective parts and to provide the repair labor at no cost to the customers. With sales being made evenly throughout the year, the company sells 620 machines in 2017 (warranty expense is incurred half in 2017 and half in 2018). As a result of product testing, the company estimates that the warranty cost is $384 per machine ($170 parts and $214...
On September 11, 2016. Home Store sells a mower for $540 with a one-year warranty that covers parts. Warranty expense is estimated at 6% of sales. On July 24, 2017, the mower is brought in for repairs covered under the warranty requiring $38 in materials taken from the Repair Parts Inventory. Prepare the September 11, 2016, entry to record the mower sale, and the July 24, 2017, entry to record the warranty repairs. (Round your answers to 2 decimal places.)...
Rotary Tools sells power tools and backs each product it sells with a one-year warranty against defects. Based on previous experience, the company expects warranty costs to be approximately 4% of sales. By the end of the first year, sales are $900,000. Actual warranty expenses incurred so far are $13,000. 1. Does this situation represent a contingent liability? OYes No 2. & 3. Record the appropriate journal entries for the warranties. (If no entry is required for a particular transaction/event,...
Bramble Company sells a machine for $7,080 with a 12-month warranty agreement that requires the company to replace all defective parts and to provide the repair labor at no cost to the customers. With sales being made evenly throughout the year, the company sells 580 machines in 2017 (warranty expense is incurred half in 2017 and half in 2018). As a result of product testing, the company estimates that the warranty cost is $430 per machine ($190 parts and 5240...
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