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Exercise 9-6A (Algo) Effect of warranties on Income and cash flow LO 9-4 To support herself while attending school, Daun Deloch sold stereo systems to other students. During the first year of operations. Daun purchased the stereo systems for $310,000 and sold them for $420,000 cash. She provided her customers with a one-year warranty against defects in parts and labor. Based on industry standards, she estimated that warranty claims would amount to 2 percent of sales. During the year, she paid $4.520 cash to replace a defective tuner. Required a. Prepare an income statement and statement of cash flows for Daun's first year of operation. b. Based on the information given, what is Daun's total warranties liability at the end of the accounting period? Complete this question by entering your answers in the tabs below. Reg A1 Reg A2 Req B Prepare an income statement for Daun's first year of operation. DAUN'S STEREOS Income Statement Req A2 >

Exercise 9-6A (Algo) Effect of warranties on Income and cash flow LO 9-4 To support herself while attending school, Daun Deloch sold stereo systems to other students. During the first year of operations. Daun purchased the stereo systems for $310,000 and sold them for $420,000 cash. She provided her customers with a one-year warranty against defects in parts and labor. Based on industry standards, she estimated that warranty claims would amount to 2 percent of sales. During the year, she paid $4.520 cash to replace a defective tuner. Required a. Prepare an income statement and statement of cash flows for Daun's first year of operation. b. Based on the information given, what is Daun's total warranties liability at the end of the accounting period? Complete this question by entering your answers in the tabs below. Reg A1 Reg A2 Req B Prepare an income statement for Daun's first year of operation. DAUN'S STEREOS Income Statement Req A2 >

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Exercise 9-6A (Algo) Effect of warranties on Income and cash flow LO 9-4 To support herself while attending school, Daun Deloch sold stereo systems to other students. During the first year of operation Daun purchased the stereo systems for $310,000 and sold them for $420,000 cash. She provided her customers with a one-ye warranty against defects in parts and labor. Based on industry standards, she estimated that warranty claims would amount to 2 percent of sales. During the year, she paid $4,520 cash to replace a defective tuner. Required a. Prepare an income statement and statement of cash flows for Daun's first year of operation. b. Based on the information given, what is Daun's total warranties liability at the end of the accounting period? Complete this question by entering your answers in the tabs below. Req A1 Reg A2 Prepare a statement of cash flows for Daun's first year of operation. (Enter cash outflows and amounts to be deducted with a minus sign.) Cash flows from operating activities Ending cash balance Net cash flow from operating activities Cash flows from investing activities Cash flows from financing activities Net change in cash Req B DAUN'S STEREOS Statement of Cash Flows Show Transcribed Text Exercise 9-6A (Algo) Effect of warranties on Income and cash flow LO 9-4 To support herself while attending school, Daun Deloch sold stereo systems to other students. During the first year of operations, Daun purchased the stereo systems for $310.000 and sold them for $420,000 cash. She provided her customers with a one-year warranty against defects in parts and labor. Based on industry standards, she estimated that warranty claims would amount to 2 percent of sales. During the year, she paid $4,520 cash to replace a defective tuner. Req A1 Required a. Prepare an income statement and statement of cash flows for Daun's first year of operation. b. Based on the information given, what is Daun's total warranties liability at the end of the accounting period? Complete this question by entering your answers in the tabs below. Reg A2 Req B Based on the information given, what is Daun's total warranties liability at the end of the accounting period? Total warranties liability < Req A2
Transcribed Image Text:Exercise 9-6A (Algo) Effect of warranties on Income and cash flow LO 9-4 To support herself while attending school, Daun Deloch sold stereo systems to other students. During the first year of operation Daun purchased the stereo systems for $310,000 and sold them for $420,000 cash. She provided her customers with a one-ye warranty against defects in parts and labor. Based on industry standards, she estimated that warranty claims would amount to 2 percent of sales. During the year, she paid $4,520 cash to replace a defective tuner. Required a. Prepare an income statement and statement of cash flows for Daun's first year of operation. b. Based on the information given, what is Daun's total warranties liability at the end of the accounting period? Complete this question by entering your answers in the tabs below. Req A1 Reg A2 Prepare a statement of cash flows for Daun's first year of operation. (Enter cash outflows and amounts to be deducted with a minus sign.) Cash flows from operating activities Ending cash balance Net cash flow from operating activities Cash flows from investing activities Cash flows from financing activities Net change in cash Req B DAUN'S STEREOS Statement of Cash Flows Show Transcribed Text Exercise 9-6A (Algo) Effect of warranties on Income and cash flow LO 9-4 To support herself while attending school, Daun Deloch sold stereo systems to other students. During the first year of operations, Daun purchased the stereo systems for $310.000 and sold them for $420,000 cash. She provided her customers with a one-year warranty against defects in parts and labor. Based on industry standards, she estimated that warranty claims would amount to 2 percent of sales. During the year, she paid $4,520 cash to replace a defective tuner. Req A1 Required a. Prepare an income statement and statement of cash flows for Daun's first year of operation. b. Based on the information given, what is Daun's total warranties liability at the end of the accounting period? Complete this question by entering your answers in the tabs below. Reg A2 Req B Based on the information given, what is Daun's total warranties liability at the end of the accounting period? Total warranties liability < Req A2
Exercise 9-6A (Algo) Effect of warranties on Income and cash flow LO 9-4 To support herself while attending school, Daun Deloch sold stereo systems to other students. During the first year of operations. Daun purchased the stereo systems for $310,000 and sold them for $420,000 cash. She provided her customers with a one-year warranty against defects in parts and labor. Based on industry standards, she estimated that warranty claims would amount to 2 percent of sales. During the year, she paid $4.520 cash to replace a defective tuner. Required a. Prepare an income statement and statement of cash flows for Daun's first year of operation. b. Based on the information given, what is Daun's total warranties liability at the end of the accounting period? Complete this question by entering your answers in the tabs below. Reg A1 Reg A2 Req B Prepare an income statement for Daun's first year of operation. DAUN'S STEREOS Income Statement Req A2 >
Transcribed Image Text:Exercise 9-6A (Algo) Effect of warranties on Income and cash flow LO 9-4 To support herself while attending school, Daun Deloch sold stereo systems to other students. During the first year of operations. Daun purchased the stereo systems for $310,000 and sold them for $420,000 cash. She provided her customers with a one-year warranty against defects in parts and labor. Based on industry standards, she estimated that warranty claims would amount to 2 percent of sales. During the year, she paid $4.520 cash to replace a defective tuner. Required a. Prepare an income statement and statement of cash flows for Daun's first year of operation. b. Based on the information given, what is Daun's total warranties liability at the end of the accounting period? Complete this question by entering your answers in the tabs below. Reg A1 Reg A2 Req B Prepare an income statement for Daun's first year of operation. DAUN'S STEREOS Income Statement Req A2 >
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