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Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 4% of sales. Sales for the month of December are $580,000. Actual warranty expenditures in January of the following year were $22,000. Required: 1. Record warranty expense and warranty liability for the month of December based on 4% of sales. 2. Record the payment of the actual warranty expenditures of $22,000 in January of the following year.

Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 4% of sales. Sales for the month of December are $580,000. Actual warranty expenditures in January of the following year were $22,000. Required: 1. Record warranty expense and warranty liability for the month of December based on 4% of sales. 2. Record the payment of the actual warranty expenditures of $22,000 in January of the following year.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 4% of sales. Sales for the month of December are $580,000. Actual warranty expenditures in January of the following year were $22,000. Required: 1. Record warranty expense and warranty liability for the month of December based on 4% of sales. 2. Record the payment of the actual warranty expenditures of $22,000 in January of the following year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 es Record the payment of the actual warranty expenditures of $22,000 in January of the following year. Note: If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. View transaction list Journal entry worksheet < 1 Record the actual warranty expenditures. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal
Transcribed Image Text:Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 4% of sales. Sales for the month of December are $580,000. Actual warranty expenditures in January of the following year were $22,000. Required: 1. Record warranty expense and warranty liability for the month of December based on 4% of sales. 2. Record the payment of the actual warranty expenditures of $22,000 in January of the following year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 es Record the payment of the actual warranty expenditures of $22,000 in January of the following year. Note: If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. View transaction list Journal entry worksheet < 1 Record the actual warranty expenditures. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal
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