TB MC Qu. 8-123 (Algo) Strikers, Incorporated sells soccer goals to customers over the...Basu, Incorporated sells soccer goals to customers over the Internet. History has shown that 2% of Basu's goals will need repair under the warranty program. For the year, Basu hassold 4,100 goals and 50 have been repaired. If the estimated cost to repair a goal is $110, what would be the warranty liability at the end of the year?Multiple Choice$3,570$3,520$0$9,020

units sold = 4100 units repaired = 50 Estimated cost to repair = $110 Estimated repair under…

B MC Qu. 8-123 (Algo) Strikers, Incorporated sells soccer goals to customers over the... lasu, Incorporated sells soccer goals to customers over the Internet. History has shown that 2% of Basu's goals will need repair under the w old 4,100 goals and 50 have been repaired. If the estimated cost to repair a goal is $110, what would be the warranty liability at the end of th Multiple Choice $3,570 $3,520 $0

B MC Qu. 8-123 (Algo) Strikers, Incorporated sells soccer goals to customers over the... lasu, Incorporated sells soccer goals to customers over the Internet. History has shown that 2% of Basu's goals will need repair under the w old 4,100 goals and 50 have been repaired. If the estimated cost to repair a goal is $110, what would be the warranty liability at the end of th Multiple Choice $3,570 $3,520 $0

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 9MC: Blake Department Store sells television sets with one-year warranties that cover repair and...

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Blake Department Store sells television sets with one-year warranties that cover repair and replacement of television parts. In the month of June, Blake sells forty television sets with a per unit cost of $500. If Blake estimates warranty fulfillment at 10% of sales, what would be the warranty liability reported in June? A. $1,000 B. $2,000 C. $500 D. $20,000
Shoe Hut sells custom, handmade shoes. It offers a one-year warranty on all shoes for repair or replacement. Review each of the transactions and prepare any necessary journal entries for each situation. A. May 31: Shoe Hut sells 100 pairs of shoes during the month of May at a sales price per pair of shoes of $240 cash. Shoe Hut records warranty estimates when sales are recognized and bases warranty estimates on 4% of sales. B. June 2: A customer files a warranty claim that Shoe Hut honors in the amount of $30 for repair to laces. Laces Inventory corresponds to shoelace inventory used for repairs. C. June 4: Another customer files a warranty claim that Shoe Hut honors. Shoe Hut replaces the damaged shoes at a cost of $200, affecting their Shoe Replacement Inventory account. D. August 10: Shoe Hut explores the possibility of bankruptcy, given the current economic conditions (recession). It determines the bankruptcy is unlikely to occur (remote).
Assurance-Type Warranty Clean-All Inc. sells washing machines with a 3-year assurance-type warranty. In the past, Clean-All has found that in the year after sale, warranty costs have been 3% of sales; in the second year after sale, 5% of sales; and in the third year after sale, 7% of sales. The following data are also available: Required: 1. Prepare the journal entries for the preceding transactions for 20192021. Closing entries are not required. 2. What amount would Clean-All report as a liability on its December 31, 2021, balance sheet, assuming the liability had a balance of 88,200 on December 31, 2018? 3. Next Level How would the failure to recognize a contingent liability affect the financial statements?
Strikers, Inc. sells soccer goals to customers over the Internet. History has shown that 4% of Strikers' goals will need repair under the warranty program. For the year, Strikers has sold 4,700 goals and 45 have been repaired. If the estimated cost to repair a goal is $120, what would be the Warranty Liability at the end of the year? $0. $17,210. $22,560. $17,160.
H9.C6 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 malls a new one from Merchandise Inventory to the customer. The company's cost per new razor Is $20 and its retall selling price is $75. The company expects warranty costs to equal 8% of dollar sales. The following transactions occurred. November 11 Sold 105 razors for $7,875 cash. November 30 Recognized warranty expense related to November sales with an adjusting entry. December 9 Replaced 15 razors that were returned under the warranty. December 16 Sold 220 razors for $16,500 cash. December 29 Replaced 30 razors that were returned under the warranty. December 31 Recognized warranty expense related to December sales with an adjusting entry. January 5 Sold 150 razors for $11, 250 cash. January 17 Replaced 50 razors that were returned under the warranty. January 31 Recognized warranty expense related to January…
Pizza Shop sells toaster ovens with a one-year warranty to fix any defects. For the current year, 100 toaster ovens have been sold. By the end of the year 4 ovens have been fixed for an average of $80 each. Management estimates that 5 more of the 100 sold will need to be fixed next year for an estimated $80 each. For how much should Pizza Shop report warranty liability at the end of the current year? a. $400.b. $320.c. $720.d. $0.
Excom sells radios and each unit carries a two-year replacement warranty. The cost of repair defects under the warranty is estimated at 5% of the sales price. During September, Excom sells 155 radios for $50 each. One radio is actually replaced during September. For what amount in September would Excom debit Product Warranty Expense? a.$22 b.$388 c.$3,410 d.$50
A company sold 122 bikes at $180 each. The bikes carry a 3-year warranty for defects. The company estimates that repair costs will average 5.0% of the total selling price. The estimated warranty liability at the beginning of the year was $1,100 and $1,500 in claims were actually incurred during the year to honor the warranty. What was the ending balance in the estimated warranty liability account? Select one: a. $1,098 b. $698 c. $1,272 d. $400 e. $1,498| This has been asked here previously, but different posts with the same questions have different answers. What is the correct one?
In 20X1, Stevens Corp. began a new product line of wearable technology that carries a 24-month warranty against manufacturer defects. Based on industry experience, Stevens expects warranty costs to be an amount equal to approximately 9% of total sales dollars. During 20X1, new sales of this technology totaled $3,000,000. The costs incurred to satisfy warranty claims in 20X1 was $90,000. Required: Answer the following two questions. Question #1: What should Stevens report as the "Warranty Expense" balance on its 20X1 income statement?Answer: Question #2: What should Stevens report as the "Warranty Liability" balance on its balance sheet at 12/31/X1?Answer
Yorkton Supply Company has a February 28, 2021 year-end. The company sells pots and provides a lifetime warranty on their product. Past experience suggests that 1% of pots sold will be returned for replacement. The estimated replacement cost of a pot is $12.77. During the year, the total sales for the company was $383,569 or 11,110 pots sold at $34.52 per unit. On April 9, 2021, 31 pots were returned and replaced under warranty at a total cost of $475.04. The returned items were unusable and thus discarded. Provide the general journal entry to record the estimated warranty expense at year-end, and the journal entry to record the returned/replaced items. Show all calculations.
Yorkton Supply Company has a February 28, 2021 year-end. The company sells pots and provides a lifetime warranty on their product. Past experience suggests that 1% of pots sold will be returned for replacement. The estimated replacement cost of a pot is $12.77. During the year, the total sales for the company was $383,569 or 11,110 pots sold at $34.52 per unit. On April 9, 2021, 31 pots were returned and replaced under warranty at a total cost of $475.04. The returned items were unusable and thus discarded. Provide the general journal entry to record the estimated warranty expense at year-end, and the journal entry to record the returned/replaced items. Show all calculations. Do not give answer in image formate
ABC sells products to customers with a warranty. Customers can return the products to ABC for a free replacement within 90 days of purchase. During April 2022, ABC sold 1,500 products to customers. During May, ABC sold 1,800 products to customers. Based on past sales, ABC estimates that 5% of all products sold will be returned for a free replacement. The products cost ABC $20 to produce and they are sold for $35 per item. During April, 100 products were returned and during May, 120 items were returned. As of March 31, 2022, ABC's Warranty Liability had a credit balance of $12,000. If ABC had an inventory balance of $80,000 on March 31, 2022, what should the inventory balance be on April 30, 2022? No purchases of inventory were made during April or May, 2022. Please enter all amounts as a positive number with no dollar signs or commas. For example, if the answer is $2,100, enter 2100. THE ANSWER IS NOT : 49800 , 30000 , 14880 , 48000