Emperor Pool Services provides pool cleaning and maintenance services to residential clients. It offers a one-year warranty on all services. Review each of the transactions: \. March 31: Emperor provides cleaning services for 25 pools during the month of March at a sales price per pool of $610 cash. Emperor records warranty estimates when sales are recognized and bases warranty estimates on 1 percent of sales. 3. April 5: A customer files a warranty claim that Emperor honors in the amount of $130 cash. C. April 13: Another customer, Jones, files a warranty claim that Emperor does not honor due to customer negligence. D. June 8: J. Jones files a lawsuit requesting damages related to the dishonored warranty in the amount of $2,100. Emperor determines that the lawsuit is likely to end in the plaintiff's favor and the $2,100 is a reasonable estimate for damages. Prepare any necessary journal entries for each situation. If an amount box does not require an entry, leave it blank. If no entry is required, select "No entry required" and leave the amount boxes blank. If required, round your answers to two decima places. Mar. 31 Cash Mar. 31 (Warranty Expense Warranty Liability Apr. 5 Apr. 13 Service Revenue. Jun. 8 ✓ ✓ ✓ 15,250 ✔ ல்ல்ல்ை 152.5 130 v 15,250 ✓ 152.5 ✔ 130 ✓
Emperor Pool Services provides pool cleaning and maintenance services to residential clients. It offers a one-year warranty on all services. Review each of the transactions: \. March 31: Emperor provides cleaning services for 25 pools during the month of March at a sales price per pool of $610 cash. Emperor records warranty estimates when sales are recognized and bases warranty estimates on 1 percent of sales. 3. April 5: A customer files a warranty claim that Emperor honors in the amount of $130 cash. C. April 13: Another customer, Jones, files a warranty claim that Emperor does not honor due to customer negligence. D. June 8: J. Jones files a lawsuit requesting damages related to the dishonored warranty in the amount of $2,100. Emperor determines that the lawsuit is likely to end in the plaintiff's favor and the $2,100 is a reasonable estimate for damages. Prepare any necessary journal entries for each situation. If an amount box does not require an entry, leave it blank. If no entry is required, select "No entry required" and leave the amount boxes blank. If required, round your answers to two decima places. Mar. 31 Cash Mar. 31 (Warranty Expense Warranty Liability Apr. 5 Apr. 13 Service Revenue. Jun. 8 ✓ ✓ ✓ 15,250 ✔ ல்ல்ல்ை 152.5 130 v 15,250 ✓ 152.5 ✔ 130 ✓
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Emperor Pool Services provides pool cleaning and maintenance services to residential clients. It offers a one-year warranty on all services. Review each of the transactions:
A. March 31: Emperor provides cleaning services for 25 pools during the month of March at a sales price per pool of $610 cash. Emperor records warranty estimates when sales are recognized and bases warranty estimates on 1 percent of sales.
B. April 5: A customer files a warranty claim that Emperor honors in the amount of $130 cash.
C. April 13: Another customer, J. Jones, files a warranty claim that Emperor does not honor due to customer negligence.
D. June 8: J. Jones files a lawsuit requesting damages related to the dishonored warranty in the amount of $2,100. Emperor determines that the lawsuit is likely to end in the plaintiff's favor and the $2,100 is a reasonable estimate for damages.
Prepare any necessary journal entries for each situation. If an amount box does not require an entry, leave it blank. If no entry is required, select "No entry required" and leave the amount boxes blank. If required, round your answers to two decimal
places.
Mar. 31 Cash
Mar. 31 Warranty Expense
Warranty Liability
Apr. 5
Apr. 13
Service Revenue
Jun. 8
✓
✓
15,250 ✓
152.5 ✓
130 ✓
ÀÒÒ⠀⠀
15,250
152.5
130
✓
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