Brief Exercise 13-13Larkspur Factory provides a 2-year warranty with one of its products which was first sold in 2017. Larkspur sold $1,017,500 of products subject to the warranty. Larkspur expects $114,200 of warranty costs over the next 2 years. In that year, Larkspur spent $68,050 servicing warranty claims. Prepare Larkspur’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 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) DateAccount Titles and ExplanationDebitCredit2017     (To record sales)During 2017     (To record warranty claims)12/31/17

Question

Brief Exercise 13-13
Larkspur Factory provides a 2-year warranty with one of its products which was first sold in 2017. Larkspur sold $1,017,500 of products subject to the warranty. Larkspur expects $114,200 of warranty costs over the next 2 years. In that year, Larkspur spent $68,050 servicing warranty claims. Prepare Larkspur’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 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date
Account Titles and Explanation
Debit
Credit
2017

 

 


(To record sales)
During 2017

 

 


(To record warranty claims)
12/31/17

 

 

 

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