Exercise 8-16 (Static) Record warranties over two years (LO8-5) Lindy Appliance begins operations in 2024 and offers a one-year warranty on all products sold. Total appliance sales in 2024 are $1,600,000, and Lindy estimates future warranty costs in 2025 to be 2% of current sales. Actual warranty costs in 2025 are $25,000. Also in 2025, Lindy has additional sales of $2,400,000 and revises its estimate of warranty costs associated with sales in 2025 to be 1.5%. Required: 1. to 3. Record the necessary entries in the Journal Entry Worksheet below. 4. What is the balance in Warranty Liability at the end of 2024 and 2025? Complete this question by entering your answers in the tabs below. Req 1 to 3 Req 4 Warranty Liability What is the balance in Warranty Liability at the end of 2024 and 2025? $ Answer is complete but not entirely correct. 2024 32,000 $ 2025 43,000 < Req 1 to 3 Reg 4 >

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
100%
Hi, I need help solving for the incorrect cells, highlighted in red (journal entry #3; req 4 (2025)). Thank you.
Exercise 8-16 (Static) Record warranties over two years (LO8-5)
Lindy Appliance begins operations in 2024 and offers a one-year warranty on all products sold. Total appliance sales in 2024 are
$1,600,000, and Lindy estimates future warranty costs in 2025 to be 2% of current sales. Actual warranty costs in 2025 are $25,000.
Also in 2025, Lindy has additional sales of $2,400,000 and revises its estimate of warranty costs associated with sales in 2025 to be
1.5%.
Required:
1. to 3. Record the necessary entries in the Journal Entry Worksheet below.
4. What is the balance in Warranty Liability at the end of 2024 and 2025?
Complete this question by entering your answers in the tabs below.
Req 1 to 3
Req 4
Warranty Liability
What is the balance in Warranty Liability at the end of 2024 and 2025?
$
2024
Answer is complete but not entirely correct.
32,000
$
2025
43,000 X
< Req 1 to 3
Req 4
Transcribed Image Text:Exercise 8-16 (Static) Record warranties over two years (LO8-5) Lindy Appliance begins operations in 2024 and offers a one-year warranty on all products sold. Total appliance sales in 2024 are $1,600,000, and Lindy estimates future warranty costs in 2025 to be 2% of current sales. Actual warranty costs in 2025 are $25,000. Also in 2025, Lindy has additional sales of $2,400,000 and revises its estimate of warranty costs associated with sales in 2025 to be 1.5%. Required: 1. to 3. Record the necessary entries in the Journal Entry Worksheet below. 4. What is the balance in Warranty Liability at the end of 2024 and 2025? Complete this question by entering your answers in the tabs below. Req 1 to 3 Req 4 Warranty Liability What is the balance in Warranty Liability at the end of 2024 and 2025? $ 2024 Answer is complete but not entirely correct. 32,000 $ 2025 43,000 X < Req 1 to 3 Req 4
Complete this question by entering your answers in the tabs below.
Req 1 to 3.
No
Record the necessary entries in the Journal Entry Worksheet below. (If no entry is required for a particular transaction/event,
select "No Journal Entry Required" in the first account field.)
1
2
3
Req 4
Date
Answer is complete but not entirely correct.
December 31, 2024 Warranty Expense
Warranty Liability
December 31, 202 Warranty Liability
Cash
December 31, 202 Warranty Expense
Warranty Liability
General Journal
< Req 1 to 3
Req 4 >
33
>
> >
Debit
32,000
25,000
>
36,000 X
Credit
32,000
25,000
36,000 X
Transcribed Image Text:Complete this question by entering your answers in the tabs below. Req 1 to 3. No Record the necessary entries in the Journal Entry Worksheet below. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) 1 2 3 Req 4 Date Answer is complete but not entirely correct. December 31, 2024 Warranty Expense Warranty Liability December 31, 202 Warranty Liability Cash December 31, 202 Warranty Expense Warranty Liability General Journal < Req 1 to 3 Req 4 > 33 > > > Debit 32,000 25,000 > 36,000 X Credit 32,000 25,000 36,000 X
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Accounting for Guarantees and Warranties
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education