instructions On August 1, Year 1, Pereira Corporation has sold 1,800 Wiglows to Mendez Company at $450 each. Mendez also purchased a 1-year service-type warranty on all the Wiglows for $12 per unit. In Year 1, On December 31, Pereira recorded warranty costs incurred in Year 1 of $9,000. Warranty costs for Year 2 of $9,600 were recorded on July 31. Required: 1. Prepare the journal entries for the preceding transactions. 2. Show how Pereira would report the items on the December 31, Year 1, balance sheet. General Journal 1. Prepare the necessary journal entries to record: 1. The sale of Wiglows and service warranty on account on August 1, Year 1 2. The warranty costs paid during Year 1 3. The warranty revenue earned in Year 1 4. The warranty costs paid during Year 2 5. The warranty revenue earned in Year 2 Year 1 entries should be recorded in page 1, Year 2 entries should be recorded in page 2. Balance Sheet 2. Show how Pereira would report the items on the December 31, Year 1, balance sheet. Balance Sheet Instruction 1 Current Liabilities: 2 PEREIRA CORPORATION Partial Balance Statement December 31, Year 1

instructions On August 1, Year 1, Pereira Corporation has sold 1,800 Wiglows to Mendez Company at $450 each. Mendez also purchased a 1-year service-type warranty on all the Wiglows for $12 per unit. In Year 1, On December 31, Pereira recorded warranty costs incurred in Year 1 of $9,000. Warranty costs for Year 2 of $9,600 were recorded on July 31. Required: 1. Prepare the journal entries for the preceding transactions. 2. Show how Pereira would report the items on the December 31, Year 1, balance sheet. General Journal 1. Prepare the necessary journal entries to record: 1. The sale of Wiglows and service warranty on account on August 1, Year 1 2. The warranty costs paid during Year 1 3. The warranty revenue earned in Year 1 4. The warranty costs paid during Year 2 5. The warranty revenue earned in Year 2 Year 1 entries should be recorded in page 1, Year 2 entries should be recorded in page 2. Balance Sheet 2. Show how Pereira would report the items on the December 31, Year 1, balance sheet. Balance Sheet Instruction 1 Current Liabilities: 2 PEREIRA CORPORATION Partial Balance Statement December 31, Year 1

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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F
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