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Business Accounting Financial Accounting: Information for Decisions

1. Adjusting Entries : Adjusting entries are the entries required to be passed at the end of the financial year to match the revenues and its related expenses by making the adjustment for any expenses payable, revenue unearned, prepaid expenses, etc. To prepare: The journal entry required to be passed for recording the warranty liabilities. The Adjusting entry for recognition of Warranty liabilities is as under: S. No. Particulars Debit ($) Credit ($) 31 s t Dec Warranty expense Dr. Warranty payable (To record the additional provision for warranty.) 7,836 7,836 The Warranty liability shall be created by crediting the Product warranty liabilities account and debit shall be made to Warranty expenses during the year. 2. Adjusting Entries: Adjusting entries are the entries required to be passed at the end of the financial year to match the revenues and its related expenses by making the adjustment for any expenses payable, revenue unearned, prepaid expenses, etc. To prepare: The journal entry for the utilization of inventory for replacing the parts under warranty. The Journal entry for utilization of inventory is as under: S. No. Particulars Debit ($) Credit ($) 31 s t Dec Warranty payable Dr. Merchandise inventory (To record utilization of inventory for warranty.) 7,134 7,134 The Cost incurred by way of replacement of parts under warranty will reduce the warranty liabilities by debiting the Product Warranty Liabilities account and credit shall be made to Merchandise inventory as it will reduce the balance of inventory in hand with such utilization. 3. Adjusting Entries: Adjusting entries are the entries required to be passed at the end of the financial year to match the revenues and its related expenses by making the adjustment for any expenses payable, revenue unearned, prepaid expenses, etc. To determine: The amount of warranty expenses to be recognized during the year. $7,836 S. No. Particulars Debit ($) Credit ($) 31 s t Dec Warranty expense Dr. Warranty payable (To record the additional provision for warranty.) 7,836 7,836 The amount of warranty expenses debited in the first entry shall be taken as warranty expenses of the year i.e. $7,836.

1. Adjusting Entries : Adjusting entries are the entries required to be passed at the end of the financial year to match the revenues and its related expenses by making the adjustment for any expenses payable, revenue unearned, prepaid expenses, etc. To prepare: The journal entry required to be passed for recording the warranty liabilities. The Adjusting entry for recognition of Warranty liabilities is as under: S. No. Particulars Debit ($) Credit ($) 31 s t Dec Warranty expense Dr. Warranty payable (To record the additional provision for warranty.) 7,836 7,836 The Warranty liability shall be created by crediting the Product warranty liabilities account and debit shall be made to Warranty expenses during the year. 2. Adjusting Entries: Adjusting entries are the entries required to be passed at the end of the financial year to match the revenues and its related expenses by making the adjustment for any expenses payable, revenue unearned, prepaid expenses, etc. To prepare: The journal entry for the utilization of inventory for replacing the parts under warranty. The Journal entry for utilization of inventory is as under: S. No. Particulars Debit ($) Credit ($) 31 s t Dec Warranty payable Dr. Merchandise inventory (To record utilization of inventory for warranty.) 7,134 7,134 The Cost incurred by way of replacement of parts under warranty will reduce the warranty liabilities by debiting the Product Warranty Liabilities account and credit shall be made to Merchandise inventory as it will reduce the balance of inventory in hand with such utilization. 3. Adjusting Entries: Adjusting entries are the entries required to be passed at the end of the financial year to match the revenues and its related expenses by making the adjustment for any expenses payable, revenue unearned, prepaid expenses, etc. To determine: The amount of warranty expenses to be recognized during the year. $7,836 S. No. Particulars Debit ($) Credit ($) 31 s t Dec Warranty expense Dr. Warranty payable (To record the additional provision for warranty.) 7,836 7,836 The amount of warranty expenses debited in the first entry shall be taken as warranty expenses of the year i.e. $7,836.

Solution Summary: The author explains that Adjusting entries are the entries required to be passed at the end of the financial year to match the revenues and its related expenses.

Financial Accounting: Information for Decisions

Financial Accounting: Information for Decisions

9th Edition

ISBN: 9781260158809

Author: Wild, John

Publisher: MCGRAW-HILL HIGHER EDUCATION

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Chapter 9, Problem 16E

Chapter 9, Problem 19E

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Chapter 9 Solutions

Financial Accounting: Information for Decisions

Ch. 9 - Prob. 1DQ Ch. 9 - Prob. 2DQ Ch. 9 - Prob. 3DQ Ch. 9 - What is the combined amount (in percent) of the...Ch. 9 - What is the current Medicare tax rate? This rate...Ch. 9 - Prob. 6DQ Ch. 9 - Prob. 7DQ Ch. 9 - Prob. 8DQ Ch. 9 - Why are warranty liabilities usually recognized on...Ch. 9 - Prob. 10DQ

Ch. 9 - Prob. 11DQ Ch. 9 - Prob. 12DQ Ch. 9 - Prob. 13DQ Ch. 9 - Prob. 14DQ Ch. 9 - Prob. 15DQ Ch. 9 - Prob. 16DQ Ch. 9 - Prob. 1QS Ch. 9 - Prob. 2QS Ch. 9 - Ticketsales, Inc., receives $5,000,000 cash in...Ch. 9 - Prob. 4QS Ch. 9 - Prob. 5QS Ch. 9 - Prob. 6QS Ch. 9 - Prob. 7QS Ch. 9 - Prob. 8QS Ch. 9 - Prob. 9QS Ch. 9 - Prob. 10QS Ch. 9 - Prob. 11QS Ch. 9 - Prob. 12QS Ch. 9 - Sera Corporation has made and recorded its...Ch. 9 - Prob. 15QS Ch. 9 - Prob. 1E Ch. 9 - Prepare any necessary entries at December 31 for...Ch. 9 - Prob. 3E Ch. 9 - Prob. 4E Ch. 9 - Prob. 5E Ch. 9 - Prob. 6E Ch. 9 - Prob. 7E Ch. 9 - Prob. 8E Ch. 9 - Prob. 9E Ch. 9 - Hitzu Co. sold a copier costing $4,800 with a...Ch. 9 - Prob. 11E Ch. 9 - Prob. 12E Ch. 9 - Prob. 13E Ch. 9 - Prob. 14E Ch. 9 - Prob. 15E Ch. 9 - Prob. 16E Ch. 9 - Prob. 18E Ch. 9 - Prob. 19E Ch. 9 - Prob. 1PSA Ch. 9 - Prob. 2PSA Ch. 9 - Paloma Co. has four employees. FICA Social...Ch. 9 - Prob. 4PSA Ch. 9 - Shown here are condensed income statements for two...Ch. 9 - Prob. 6PSA Ch. 9 - Warner Co. entered into the following transaction...Ch. 9 - Prob. 2PSB Ch. 9 - Fishing Guides Co. has four employees. FICA Social...Ch. 9 - On November10, 2017, Lee Co. began operations by...Ch. 9 - Shown here are condensed income statements for two...Ch. 9 - Prob. 6PSB Ch. 9 - Prob. 9SP Ch. 9 - Prob. 1GLP Ch. 9 - Prob. 1FSA Ch. 9 - Prob. 2FSA Ch. 9 - Prob. 3FSA Ch. 9 - Prob. 1BTN Ch. 9 - Prob. 2BTN Ch. 9 - Assume that your team is in business and you must...Ch. 9 - Prob. 5BTN

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