What amount of liability would the company report on its statement of financial position at the end of the current year.
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abc Company manufacturers high end-whole electronic systems. The company provides a one-year warranty for all products sold. The company estimates that the warranty cost id P2,000 per unit sold and reported a liability for estimated warranty costs P6.5 million at the beginning of this year. If during the current year, the company sold 5,000 units for a total of P36.3 million and paid warranty claims of P7,500,000 on current and prior year sales.
What amount of liability would the company report on its
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- ABC Company manufacturers high end-whole electronic systems. The company provides a one-year warranty for all products sold. The company estimates that the warranty cost id P2,000 per unit sold and reported a liability for estimated warranty costs P6.5 million at the beginning of this year. If during the current year, the company sold 5,000 units for a total of P36.3 million and paid warranty claims of P7,500,000 on current and prior year sales. What amount of liability would the company report on its statement of financial position at the end of the current year.The Price is Right manufactures electronic systems. The company provides a one-year warranty for all products sold. The company estimates that the warranty cost is $200 per unit sold and reported a liability for estimated warranty costs $6.5 million at the beginning of this year. If during the current year, the company sold 50,000 units for a total of $243 million and paid warranty claims of $7,500,000 on current and prior year sales, what amount of liability would the company report on its statement of financial position at the end of the current year? Select one: $2,500,000. $3,500,000. $9,000,000. $10,000,000.The Price is Right manufactures electronic systems. The company provides a one-year warranty for all products sold. The company estimates that the warranty cost is $200 per unit sold and reported a liability for estimated warranty costs $6.5 million at the beginning of this year. If during the current year, the company sold 50,000 units for a total of $243 million and paid warranty claims of $7,500,000 on current and prior year sales, what amount of liability would the company report on its statement of financial position at the end of the current year? Select one: a. $2,500,000. O b. $9,000,000. O c. $10,000,000. O d. $3,500,000.
- Entity A manufactures high-end home electronics systems. The entity provides a one-year warranty for all products sold. The entity estimated that the warranty cost is P200 per unit sold and reported a liability for estimated warranty cost of P650,000 at the beginning of the year. The entity sold 5,000 units for a total of P9,000,000 and paid warranty claims of P750,000 on current and prior year sales during the current year. What about should be reported as warranty liability at year-end? 350,000 250,000 750,000 900,000Blue Jay, Inc., manufactures and sells computer monitors with a three-year warranty.Warranty costs are expected to average 7% of sales during the warranty period. The followingtable shows the sales and actual warranty payments during the first two years of operations:Year Sales Warranty Payments2018 $650,000 $ 5,8502019 850,000 42,500Based on these facts, what amount of warranty liability should Blue Jay, Inc., report on itsbalance sheet at December 31, 2019?a. $48,350b. $56,650c. $105,000d. $42,500E. An entity sells washing machines that carry a three-year warranty against manufacturer's defects. Based on the entity's experience, warranty costs are estimated at P300 per machine. During the year, the entity sold 2,400 washing machines and paid warranty costs of P170,000. What amount should be reported as estimated warranty liability at year-end?
- Company Z manufactures printers, which comes with one-year warranty. During this year, Company Z sold 51,000 units of printers for $510,000 of total revenues. The company estimates that it will cost the company $150 in warranty costs for every unit sold. At the beginning of this year, Company Z reported a liability for estimated warranty costs of $1,000,000. During the year, the company paid $850,000 in warranty claims filed by customers for printers they had bought. At the end of year, what would be the total warranty liability reported on the balance sheet?Kap Co. offers a three year warranty on its products. Kap previously estimated warranty costs to be 2% of sales. Due to a technological advance in production at the beginning of year 3, Kap now believes 1% of sales to be a better estimate of warranty costs. Warranty costs of P800,000 and P960,000 were reported in year 1 and year 2, respectively. Sales for year 3 were P50,000,000. 1. What amount should be presented in Kap's year 3 financial statements as warranty expense?Haeir Co. sells washing machines that carry a three-year warranty against manufacturer's defects. Based on the entity's experience, warranty costs are estimated at P 300 per machine. During the current year, the entity sold 2,400 washing machines and paid warranty costs of P 170,000. What amount should be reported as warranty expense for the years? What amount should be reported as warranty liability at year-end? respectively * A.P 720,000 and P 170,000 B.P 170,000 and P 720,000 C.P 240,000 and P 550,000 D.P 720,000 and P 550,000
- Warranty4U provides extended service contracts on electronic equipment sold through major retailers. The standard contract is for three years. During the current year, Warranty4U provided 2,000 such warranty contracts at an average price of $30 each Related to these contracts, the company spent $15,000 servicing the contracts during the current year and expects to spend $10,000 more in the future What is the net protit that the company will recognize in the current year related to these contracts $25,000 O $10,000 D $5,000 O No Answer is Correct OChato Company sells electrical goods covered by a one-year warranty for any defects. Of the sales of P70,000,000 for the year, the entity estimates that 3% will have major defect, 5% will have minor defect and 92% will have no defect. The cost of repairs would be P5,000,000 if all the products sold had major defect andP3,000,000 if all had minor defect. What amount should be recognized as a warranty provision? a. 8,000,000 b. 5,600,000 c. 300,000 d. 190,000Calla Corp. sells equipment that comes with a two-year unlimited warranty on parts and labour for repairs. All sales are cash sales. The warranty is intended to assure customers that the appliances will operate as advertised. The warranty is expected to cost 2% of sales in the first year and 4% of sales in the second year, for a total of 6%. The provision for warranty has a credit balance of $189,000 at the beginning of 20X5. The following events and decisions relate to the warranty: 20X5 Sales revenue of $4,650,000 was generated from products covered by the warranty. Both the sale and the warranty provision must be recorded. 20X5 Warranty work consumed parts inventory with a cost of $8,300, and labour of $33,000. Labour costs were paid in cash. 20X6 Sales revenue from products covered by the warranty were $6,650,000. Both the sale and the warranty provision must be recorded. 20X6 Warranty work…