Required information[The following information applies to the questions displayed below)Hitzu Company sold a copier (that costs $4,500) for $9,000 cash with a two-year parts warranty to a customer on August16 of Year 1. Hitzu expects warranty costs to be 3% of dollar sales. It records warranty expense with an adjusting entry onDecember 31. On January 5 of Year 2, the copier requires on-site repairs that are completed the same day. The repairscost $133 for materials taken from the repair parts inventory. These are the only repairs required in Year 2 for this copier.Analyze each transaction's effect on the accounting equation-specifically, identify the accounts and amounts (including +or+) foreach.Note: Enter all amounts as positive value.DateAugust 16August 16December 31January 5AssetsLiabilitiesEquity

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Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter8: Current And Contingent Liabilities

Section: Chapter Questions

Problem 56BE

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Required Information Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] Hitzu Company sold a copier (that costs $5,500) for $11,000 cash with a two-year parts warranty to a customer on August 16 of Year 1. Hitzu expects warranty costs to be 5% of dollar sales. It records warranty expense with an adjusting entry on December 31. On January 5 of Year 2, the copier requires on-site repairs that are completed the same day. The repairs cost $147 for materials taken from the parts inventory. These are the only repairs required in Year 2 for this copier. Exercise 9-13 (Algo) Financial statement Impact of warranty transactions LO P4 Analyze each of the following transactions: (a) the copier's sale: (b) the adjustment to recognize the warranty expense on December 31 of Year 1; and (c) the repairs that occur on January 5 of Year 2. Show each transaction's effect on the accounting equation-specifically. identify the…
Required information Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] Hitzu Company sold a copier (that costs $6,500) for $13,000 cash with a two-year parts warranty to a customer on August 16 of Year 1. Hitzu expects warranty costs to be 5% of dollar sales. It records warranty expense with an adjusting entry on December 31. On January 5 of Year 2, the copier requires on-site repairs that are completed the same day. The repairs cost $93 for materials taken from the parts inventory. These are the only repairs required in Year 2 for this copier. Exercise 9-13 (Algo) Financlal statement impact of warranty transactions LO P4 Analyze each of the following transactions: (a) the copier's sale; (b) the adjustment to recognize the warranty expense on December 31 of Year 1; and (c) the repairs that occur on January 5 of Year 2. Show each transaction's effect on the accounting equation-specifically, identify the…
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Cullumber Ltd. sells computers, computer accessories, and software. On its computer sales, the company provides a one-month warranty that is included in the cost of the computer. Claims under the warranties vary from replacing defective items to providing customers with refunds if they choose. During 2024, the estimated costs related to the one-month warranties was $52,000, of whic $46,800 had been incurred before year end ($39,000 for replacement items and $7,800 in refunds). For an additional charge of $130, Computers Galore also offers extended warranty coverage for two years on its computers. This amount is expected to cover the costs associated with the extended warranties. During 2024, Computers Galore sold 1,040 two-ye warranties. The costs incurred during the year for replacements under these warranties amounted to $40,300. Based on experienc the company estimates that its total warranty costs over the two-year coverage period will be $78,000, which it expects will occur evenly…
XYZ Computers manufactures and sells moblile tokens and radio token systems which include a 180 day warranty on product defects. It also sells an extended warranty which provides an additional two years of protection. On May 10, the company sold a token system for $3,850 and an extended warranty for another $1,200. The journal entry to record this transaction by XYZ would include Select one: O a. a debit to Prepaid Service Revenue of $1,200 O b. a credit to Sales Revenue of $5,020 O c.a credit to Unearned Service Revenue of $1200. O d. a credit to Service Revenue of $5,050
please dont provide answer in image format thank you [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 $14 and its retail selling price is $70. The company expects warranty costs to equal 5% of dollar sales. The following transactions occurred. November 11 Sold 60 razors for $4,200 cash. November 30 Recognized warranty expense related to November sales with an adjusting entry. December 9 Replaced 12 razors that were returned under the warranty. December 16 Sold 180 razors for $12,600 cash. December 29 Replaced 24 razors that were returned under the warranty. December 31 Recognized warranty expense related to December sales with an adjusting entry. January 5 Sold 120 razors for $8,400 cash.…
Carla Vista Resellers Ltd. (CVRL) sells gently used and refurbished appliances. The company provides a three-month warranty that is included in the cost of the appliance. Claims under the warranties vary from replacing defective parts to providing customers with new appliances if repairs cannot be made. During 2024, the estimated cost related to the three-month warranties was $36,480, of which $24,000 had been incurred before year end ($18,240 on replacement appliances and $5,760 for parts). For an additional charge of $144, CVRL also offers extended warranty coverage for three years on its refurbished appliances. This amount is expected to cover the costs associated with the extended warranties. During 2024, CVRL sold 480 three-year warranty plans. The costs incurred during the year for repairs and replacements under these plans amounted to $14,400. Based on experience, the company estimates that its total warranty costs over the three-year coverage period will be $43,200, which it…
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Cullumber Resellers Ltd. (CRL) sells gently used and refurbished appliances. The company provides a three-month warranty that is included in the cost of the appliance. Claims under the warranties vary from replacing defective parts to providing customers with new appliances if repairs cannot be made. During 2024, the estimated cost related to the three-month warranties was $41,040, of which $27,000 had been incurred before year end ($20,520 on replacement appliances and $6,480 for parts). For an additional charge of $162, CRL also offers extended warranty coverage for three years on its refurbished appliances. This amount is expected to cover the costs associated with the extended warranties. During 2024, CRL sold 540 three-year warranty plans. The costs incurred during the year for repairs and replacements under these plans amounted to $16,200. Based on experience, the company estimates that its total warranty costs over the three-year coverage period will be $48,600, which it expects…
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