Nov. 1 Made sales of $52,000. McNight estimates that warranty expense is 6% of sales. (Record only the warranty expense.) 20 Paid $1,600 to satisfy warranty claims. Dec. 31 Estimated vacation benefits expense to be $6,000. 31 McNight expected to pay its employees a 3% bonus on net income after deducting the bonus. Net income for the year is $52,000.

Nov. 1 Made sales of $52,000. McNight estimates that warranty expense is 6% of sales. (Record only the warranty expense.) 20 Paid $1,600 to satisfy warranty claims. Dec. 31 Estimated vacation benefits expense to be $6,000. 31 McNight expected to pay its employees a 3% bonus on net income after deducting the bonus. Net income for the year is $52,000.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 12Q: A companys sales for January are $250,000. If the company projects warranty obligations to be 5% of...

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A companys sales for January are $250,000. If the company projects warranty obligations to be 5% of sales, what is the warranty liability amount for January?
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