QS 9-13 (Algo) Recording warranty repairs LO P4On December 1, Home Store sells a mower (that costs $280) for $580 cash with a one-year warranty that covers parts. Warrantyexpense is estimated at 8% of sales. On January 24 of the following year, the mower is brought in for repairs covered under thewarranty requiring $41 in materials taken from the Parts Inventory.Prepare the December 1 entry to record the mower sale (and cost of sale), the December 31 adjusting entry for estimated warrantyliability, and the January 24 entry to record the warranty repairs. (Round your answers to 2 decimal places.)View transaction listJournal entry worksheet123 4>Record the mower sales.Note: Enter debits before credits.DateGeneral JournalDebitCreditDecemberView transaction listJournal entry worksheet234>Record the cost of mower sales.Note: Enter debits before credits.DateGeneral JournalDebitCreditDecember01Journal entry worksheet<>< 124Record the estimated warranty expense.Note: Enter debits before credits.General JournalDebitCreditDateDecember31Journal entry worksheet< 1 23Record the cost of warranty repairs.Note: Enter debits before credits.DebitCreditDateGeneral JournalJanuary 24

The journal entries are prepared to keep the record of day to day transactions of the business.

QS 9-13 (Algo) Recording warranty repairs LO P4 On December 1, Home Store sells a mower (that costs $280) for $580 cash with a one-year warranty that covers parts. Warranty expense is estimated at 8% of sales. On January 24 of the following year, the mower is brought in for repairs covered under the warranty requiring $41 in materials taken from the Parts Inventory. Prepare the December 1 entry to record the mower sale (and cost of sale), the December 31 adjusting entry for estimated warranty liability, and the January 24 entry to record the warranty repairs. (Round your answers to 2 decimal places.) View transaction list

QS 9-13 (Algo) Recording warranty repairs LO P4 On December 1, Home Store sells a mower (that costs $280) for $580 cash with a one-year warranty that covers parts. Warranty expense is estimated at 8% of sales. On January 24 of the following year, the mower is brought in for repairs covered under the warranty requiring $41 in materials taken from the Parts Inventory. Prepare the December 1 entry to record the mower sale (and cost of sale), the December 31 adjusting entry for estimated warranty liability, and the January 24 entry to record the warranty repairs. (Round your answers to 2 decimal places.) View transaction list

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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ll alfa ? 9:26 am During 2017, Alaa Company sold 600 TV for $500 each. The sold items include a one-year warranty. The manager estimated that 5% of these TVs will be defective and the warranty repair cost is $40 per TV. In 2017, Alaa honors warranty contracts for 12 TVs. During the first month of 2018, the company honors warranty contracts for 3 TVs. The adjusting entry to accrue the estimated warranty costs is: * Debit Warranty Expense $15,000 Credit Warranty Liability $15,000 Debit Warranty Expense $1,200 Credit Warranty Liability $1,200 Debit Warranty Liability $1,200 Credit Warranty Expense $1,200 Debit Warranty Liability $480 Credit Cash $480 None of the above
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Problem 11-4A (Algo) Estimating warranty expense and liability LO P4 [The following information applies to the questions displayed below.] On October 29, Lobo Company began operations by purchasing razors for resale. The razors have a 90-day warranty. When a razor is returned, the company discards it and mails a new one from Merchandise Inventory to the customer. The company's cost per new razor is $13 and its retail selling price is $80. The company expects warranty costs to equal 8% of dollar sales. The following transactions occurred. November 11 Sold 80 razors for $6,400 cash. November 30 Recognized warranty expense related to November sales with an adjusting entry. December 9 Replaced 16 razors that were returned under the warranty. December 16 Sold 240 razors for $19,200 cash. December 29 Replaced 32 razors that were returned under the warranty. December 31 Recognized warranty expense related to December sales with an adjusting entry. January 5 Sold 160 razors for $12,800 cash.…
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