Homework Answers
1.
| No. | Account Titles and Explanation | Debit | Credit |
| 1 | Cash (11% x $2200000) | $ 242,000.00 | |
| Notes receivable | $ 1,958,000.00 | ||
| Sales revenue | $ 2,200,000.00 | ||
| (To record sales) | |||
| 2 | Warranty expense (8% x $2200000) | $ 176,000.00 | |
| Estimated Warranty Payable | $ 176,000.00 | ||
| (To record warranty expense) | |||
| 3 | Estimated Warranty Payable | $ 85,000.00 | |
| Cash | $ 85,000.00 | ||
| (To record warranty payments) |
2.
| Estimated Warranty Payable | |||
| Payment | $ 85,000.00 | Beginning Balance | $ 41,000.00 |
| Accrual - Warranty Expense | $ 176,000.00 | ||
| Ending Balance | $ 132,000.00 | ||
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