Boston Company sells baked bean making machines and guarantees them for three years. Company experience shows that warranty costs are about 5% of sales. Boston Company made sales of totaling $1,650,000 during 2021. The cost of the machines sold was $1,072,500. For the first quarter ending March 31, 2022, Boston Company paid out $16,550 of costs related to satisfying warranty repairs. In journal provided: a. Record the baked bean making machine sales for 2021 assuming all sales were on account. b. Record the warranty expense for 2021. c. Record the payment of warranty expenses for the quarter-ended March 31, 2022. Assume all expenses are paid in cash for repairs. d. Determine the ending balance in the Estimated Warranty Liability account as of March 31, 2022 if the beginning balance for 2021 was $12,000.

Boston Company sells baked bean making machines and guarantees them for three years. Company experience shows that warranty costs are about 5% of sales. Boston Company made sales of totaling $1,650,000 during 2021. The cost of the machines sold was $1,072,500. For the first quarter ending March 31, 2022, Boston Company paid out $16,550 of costs related to satisfying warranty repairs. In journal provided: a. Record the baked bean making machine sales for 2021 assuming all sales were on account. b. Record the warranty expense for 2021. c. Record the payment of warranty expenses for the quarter-ended March 31, 2022. Assume all expenses are paid in cash for repairs. d. Determine the ending balance in the Estimated Warranty Liability account as of March 31, 2022 if the beginning balance for 2021 was $12,000.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter9: Current Liabilities And Contingent Obligations

Section: Chapter Questions

Problem 10RE

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Boston Company sells baked bean making machines and guarantees them for three years. Company experience shows that warranty costs are about 5% of sales. Boston Company made sales of totaling $1,650,000 during 2021. The cost of the machines sold was $1,072,500. For the first quarter ending March 31, 2022, Boston Company paid out $16,550 of costs related to satisfying warranty repairs. In journal provided: a. Record the baked bean making machine sales for 2021 assuming all sales were on account. b. Record the warranty expense for 2021. c. Record the payment of warranty expenses for the quarter-ended March 31, 2022. Assume all expenses are paid in cash for repairs. d. Determine the ending balance in the Estimated Warranty Liability account as…
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Please help me. Thankyou.
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Pesto Company started its business in selling printers with three-year warranty. It estimates its warranty cost as a percentage of peso sales. Based on past experience, it is estimated that 3% will be repaired during the first year of warranty, 5% will be repaired during the second year of warranty and 7% will be repaired in the third year. The product warranty provides service other than agreed upon specification. In 2021 and 2022, the company was able to sell 10,000 units and 12,500 units, respectively at a total price of P7,000 per unit. The company also incurred actual repair costs of P3,500,000 and P9,500,000 in 2021 and 2022, respectively. The selling price of the warranty is P2,000 per unit. The printer is selling at P5,000 if without the warranty. Pesto Company should report unearned warranty income at the end of December 31, 2022 of? P10,625,000 P29,333,333 P21,666,667 P16,000,000
Pesto Company started its business in selling printers with three-year warranty. It estimates its warranty cost as a percentage of peso sales. Based on past experience, it is estimated that 3% will be repaired during the first year of warranty, 5% will be repaired during the second year of warranty and 7% will be repaired in the third year. The product warranty provides service other than agreed upon specification. In 2021 and 2022, the company was able to sell 10,000 units and 12,500 units, respectively at a total price of P7,000 per unit. The company also incurred actual repair costs of P3,500,000 and P9,500,000 in 2021 and 2022, respectively. The selling price of the warranty is P2,000 per unit. The printer is selling at P5,000 if without the warranty. Pesto Company should report unearned warranty income at the end of December 31, 2022 of? Group of answer choices P29,333,333 P21,666,667 P16,000,000 P10,625,000
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Boston Company sells baked bean making machines and guarantees them for three years.
Company experience shows that warranty costs are about 5% of sales. Boston Company made
sales of totaling $1,650,000 during 2021. The cost of the machines sold was $1,072,500.

For the first quarter ending March 31, 2022, Boston Company paid out $16,550 of costs related
to satisfying warranty repairs.

In journal provided:
a. Record the baked bean making machine sales for 2021 assuming all sales were on account.

b. Record the warranty expense for 2021.

c. Record the payment of warranty expenses for the quarter-ended March 31, 2022. Assume all
expenses are paid in cash for repairs.

d. Determine the ending balance in the Estimated Warranty Liability account as of March 31, 2022
if the beginning balance for 2021 was $12,000.