Skysong Factory provides a 2-year warranty with one of its products which was first sold in 2025. Skysong sold $997,500 of products subject to the warranty. Skysong expects $120,250 of warranty costs over the next 2 years. In that year, Skysong spent $71,080 servicing warranty claims. Prepare Skysong's journal entry to record the sales (ignore cost of goods sold) and the December 31 adjusting entry, assuming the expenditures are inventory costs. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. List all debit entries before credit entries.) Date During 2025 12/31/25 Account Titles and Explanation (To record payment for warranty costs incurred) (To record sales) Debit Credit ]]] 11
Skysong Factory provides a 2-year warranty with one of its products which was first sold in 2025. Skysong sold $997,500 of products subject to the warranty. Skysong expects $120,250 of warranty costs over the next 2 years. In that year, Skysong spent $71,080 servicing warranty claims. Prepare Skysong's journal entry to record the sales (ignore cost of goods sold) and the December 31 adjusting entry, assuming the expenditures are inventory costs. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. List all debit entries before credit entries.) Date During 2025 12/31/25 Account Titles and Explanation (To record payment for warranty costs incurred) (To record sales) Debit Credit ]]] 11
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Vaibhav
Transcribed Image Text:Skysong Factory provides a 2-year warranty with one of its products which was first sold in 2025. Skysong sold $997,500 of products
subject to the warranty. Skysong expects $120,250 of warranty costs over the next 2 years. In that year, Skysong spent $71,080
servicing warranty claims. Prepare Skysong's journal entry to record the sales (ignore cost of goods sold) and the December 31
adjusting entry, assuming the expenditures are inventory costs. (If no entry is required, select "No Entry" for the account titles and enter O
for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. List all debit entries before
credit entries.)
Date
During 2025
12/31/25
Account Titles and Explanation
(To record payment for warranty costs incurred)
(To record sales)
Debit
Credit
ILIT
10711
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