On January 2, 2025, Sunland Company sells production equipment to Bramble Inc. for $54,000. Sunland includes a 2-year assurancewarranty service with the sale of all its equipment. The customer receives and pays for the equipment on January 2, 2025. During2025, Sunland incurs costs related to warranties of $940. At December 31, 2025, Sunland estimates that $680 of warranty costs willbe incurred in the second year of the warranty.(a)Prepare the journal entry to record this transaction on January 2, 2025, and on December 31, 2025 (assuming financialstatements are prepared on December 31, 2025). (Credit account titles are automatically indented when the amount is entered. Do notindent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List all debit entries beforecredit entries. Record journal entries in the order presented in the problem.)DateAccount Titles and ExplanationDebitCredit

Step 1:Preparation of journal entries. DateAccount Titles and ExplanationDebitCreditJan 2,…

Answered: On January 2, 2025, Sunland Company…

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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