Pronghorn Computer Company sells computers for $1,800 each, which includes a three-year warranty that requires the company to perform periodic services and to replace defective parts. During 2023, Pronghorn sold 580 computers on account. Based on past experience, the company has estimated the total three-year warranty costs at $80 for parts and $100 for labour. (Assume sales all occur at December 31, 2023.) In 2024, Pronghorn Computer Company incurred actual warranty costs relative to 2023 computer sales of $9,800 for parts and $13,000 for labour. (a) Using the expense warranty approach, prepare the entries to reflect the above transactions (accrual method) for 2023 and 2024. Use Salaries and Wages Payable. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Debit Account Titles and Explanation 2023 (To record credit sales) (To accrue warranty expense) Account Titles and Explanation 2024 Credit 111 10 00 Debit Credit

Pronghorn Computer Company sells computers for $1,800 each, which includes a three-year warranty that requires the company to perform periodic services and to replace defective parts. During 2023, Pronghorn sold 580 computers on account. Based on past experience, the company has estimated the total three-year warranty costs at $80 for parts and $100 for labour. (Assume sales all occur at December 31, 2023.) In 2024, Pronghorn Computer Company incurred actual warranty costs relative to 2023 computer sales of $9,800 for parts and $13,000 for labour. (a) Using the expense warranty approach, prepare the entries to reflect the above transactions (accrual method) for 2023 and 2024. Use Salaries and Wages Payable. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Debit Account Titles and Explanation 2023 (To record credit sales) (To accrue warranty expense) Account Titles and Explanation 2024 Credit 111 10 00 Debit Credit

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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