alk Unlimited began business on January 1, 2003. The company manufactures and sells cell phones cases. The company provides a warranty on its units, whereby the company will replace any defective case for two years after the sale, at no additional cost to the customer. During 2003, Talk Unlimited had sales of $850,000. The company estimates that the cost of the warranties will be 2% of sales. No warranty claims were made in 2003. During 2004, warranty claims of $15,700 were made. All warranty claims were satisfied and paid for. What journal entry, if any, is necessary for 2003 by Talk Unlimited? A) No journal entry is necessary
Talk Unlimited began business on January 1, 2003. The company manufactures and sells cell phones cases. The company provides a warranty on its units, whereby the company will replace any defective case for two years after the sale, at no additional cost to the customer. During 2003, Talk Unlimited had sales of $850,000. The company estimates that the cost of the warranties will be 2% of sales. No warranty claims were made in 2003. During 2004, warranty claims of $15,700 were made. All warranty claims were satisfied and paid for. What
A) No journal entry is necessary.
B) Prepaid Warranty 17,000
Liability for Warranties 17,000
C) Warranty Expense 17,000
Liability for Warranties 17,000
D) Warranty Expense 17,000
Warranty Sales 17,000
E) Warranty Expense 17,000
Unearned Warranties 17,000
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