Ecco Company sold $127,000 of ktchen appliances with six month warranties during September. The cost to repair detects under the warranty is estimated at 5% of the sales price On October 15, a customer required a $240 part replacement, plus s84 labor under the warranty. Required: Provide the oumal entry for (a) the estimated expense on September 30 and (b) the October 15 warranty work. Reter to the Chart of Accounts for exact wording of account tes.
Ecco Company sold $127,000 of ktchen appliances with six month warranties during September. The cost to repair detects under the warranty is estimated at 5% of the sales price On October 15, a customer required a $240 part replacement, plus s84 labor under the warranty. Required: Provide the oumal entry for (a) the estimated expense on September 30 and (b) the October 15 warranty work. Reter to the Chart of Accounts for exact wording of account tes.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Ecco Company sold $127,000 of kitchen appliances with six-month warranties during September. The ocost to repair defects under the warranty is estimated at 5%
of the sales price. On October 15, a customer required a $240 part replacement, plus $84 labor under the warranty.
Required:
Provide the journal entry for (a) the estimated expense on September 30 and (b) the October 15 warranty work. Refer to the Chart of Accounts
for exact wording of account titles.
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