QUESTION 3Staples extends a lifetime replacement warranty on all its financial calculators. Usingpast experience, Staples estimates that 1% of all units sold will be returned and requirereplacement at their average cost. On January 1, 2020, the balance in Staples' EstimatedWarranty Liability account was $2,020. On January 2nd 2020 Staples purchased 6,000calculators for $240,000 to have available in inventory. Staples sells its calculators for$50/unit, and during 2020, sales totaled $275,000. The actual number of units returnedand replaced was 50.1. Prepare the entry to estimate warranty liabilities based on the calculators sold for 2020.Assume the adjustment is made on December 31".2. Record the replacement of the calculators returned in 2020 (use a date of December31)3. Calculate the balance in the Estimated Warranty Liability account at December 31,2020.

1. Warranty expense a/c Dr. 2750 To Warranty liability a/c. 2750 (Being estimated…

QUESTION 3 Staples extends a lifetime replacement warranty on all its financial calculators. Using past experience, Staples estimates that 1% of all units sold will be returned and require replacement at their average cost. On January 1, 2020, the balance in Staples' Estimated Warranty Liability account was $2,020. On January 2nd 2020 Staples purchased 6,000 calculators for $240,000 to have available in inventory. Staples sells its calculators for S50/unit, and during 2020, sales totaled $275,000. The actual number of units returned and replaced was 50. 1. Prepare the entry to estimate warranty liabilities based on the calculators sold for 2020. Assume the adjustment is made on December 31". 2. Record the replacement of the calculators returned in 2020 (use a date of December 31) 3. Calculate the balance in the Estimated Warranty Liability account at December 31, 2020.

QUESTION 3 Staples extends a lifetime replacement warranty on all its financial calculators. Using past experience, Staples estimates that 1% of all units sold will be returned and require replacement at their average cost. On January 1, 2020, the balance in Staples' Estimated Warranty Liability account was $2,020. On January 2nd 2020 Staples purchased 6,000 calculators for $240,000 to have available in inventory. Staples sells its calculators for S50/unit, and during 2020, sales totaled $275,000. The actual number of units returned and replaced was 50. 1. Prepare the entry to estimate warranty liabilities based on the calculators sold for 2020. Assume the adjustment is made on December 31". 2. Record the replacement of the calculators returned in 2020 (use a date of December 31) 3. Calculate the balance in the Estimated Warranty Liability account at December 31, 2020.

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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Sales made in 2021 for $3,000,000 includes a 2-year warranty coverage, included in the price. The estimated cost for warranty is expected to be 2% for the first year and 5% for the second year. How much warranty expense should be recorded in 2021? Question 4 options: $60,000 $150,000 $100,500 $210,000
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Choke Company sells products with reusable and expensive containers. The customer is charged a deposit for each container delivered and receives a refund for each container returned within two years after the year of delivery. Containers unreturned at the beginning of 2020 P50,000 Containers delivered in 2020 500,000 Containers returned in 2020 240,000 Expired containers 30,000 How much is the deposit liability?
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HANDOUT PROBLEM for CURRENT LIABILITIES I. Prepare journal entries for the following chronological transactions and a. You sold merchandise on account for $250,000 on account. The products cost $110,000. Your company uses a perpetual inventory system. Your sales included a two-year warranty on the product. You spent $1,400 to repair products in part "a." which were under warranty. On December 31, 2021, you estimated that there would be an additional $8,000 of b. с. repairs on products in part "a." You estimated that $5,000 of the repairs would оссur in 2022. In 2022, you performed $4,800 of repairs on products from part "a." and $1,920 of repairs on products sold in 2022. On December 31, 2022, you estimated that repairs on products sold in 2021 would be an additional $3,500 and for products sold in 2022 would be an additional $9,000. You believe that $5,400 of the $9,000 of repairs would occur d. е. in 2023. II. Based upon the transaction above, determine the amount of current…
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Part A: Giordano Corp. sold machinery for $2,000,000 and it was delivered in November 2020. On November 20, the customer informed Giordano Corp. that they were satisfied with the machinery. Giordano Corp. provided a warranty on the machinery for two years from November 20, 2020. The initial estimated warranty cost to Giordano Corp was estimated at $200,000. The stand-alone-value of the warranty is $150,000 and of the machinery is $1,900,000. The machinery can be purchased without the warranty by the customer. What would be the amount of unearned revenue on November 20 recorded by Giordano Corp.? (Round percentages to whole numbers). Show your work. a) Between $1,800,000-$1,900,000 b) Between $150,000-$160,000 c) None of the choices d) Between $140,000 - $147,000 e) Between $1,900,000-$2,000,000
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