REQUIREDREAD THE BELOW QUESTIONS CAREFULLY.1. January 1: If Tiger sold, on net/30 credit terms, a Pinnacle with the 5-year extendedwarranty as a package, prepare all of the applicable journal entry or entries at the date ofthe delivery associated with the sale.2. January 5: Assume that Tiger transfers the $19,200 account receivable to FactoringCompany for cash on a with-recourse basis. Tiger agrees with Factoring Company that aholdback of $700 is appropriate. Factoring Company pays Tiger $15,760 cash. Preparethe journal entry or entries to reflect the above situation3. January 1: Ignore your answers to parts (1) and (2). Assume Tiger sells one Pinnacle to acustomer without any extended warranty (only the Pinnacle itself is sold) on the followingterms:a. Cash down payment of $3,000.b. $15,000 Promissory note due three years from the date of sale. Stated interest rateis 2%. Interest will be paid annually on December 31.The market rate of interest for a similar note would be 6%. Assume Tiger is permitted torecognize Fevenue at the date of sale. Prepare the journal entry or entries for the abovesituation:4. Decembér 31. Assume Tiger receives an interest payment relating to the promissory notereceivable [part (C) above]. Prepare the journal entry or entries for this situation Tiger Limited is a manufacturer of high-powered computers. Tiger's computers are sold with a typicalassurance-type warranty of twelve months. At the time of a sale, the purchaser has the option to buy thecomputer with a 5-year extended warranty. The 5-years would begin after the end of the six-monthassurance-type warranty. If the purchaser chooses not to buy the 5-year extended warranty at the time ofthe purchase, the purchaser can still buy the 5-year extended warranty up to six months later. The followinginformation is available regarding the manufacturer's "Pinnacle" model of computer:a. When a Pinnacle is purchased as a package with the 5-year extended warranty, the selling price forthe package is $19,200. This special offer is only available at the time of the initial purchase.b. If the 5-year optional extended warranty were to be purchased by itself (separate from thecomputer), the price would be $2,000.c. The normal selling price of a Pinnacle with the assurance warranty, but without the 5-year extendedwarranty, is $18,000. The cost of goods is $12,600 and Tiger uses a perpetual inventory system.d. Tiger estimates that its Pinnacle computer will have assurance-type warranty claims of 3.5% of thenormal selling price of the computer.In all applicable situations, Tiger uses the gross method.

DATE PARTICULARS DEBIT CREDIT 1) JAN 1 A/C Receivables A/C Dr 19,200 To…

READ THE BELOW QUESTIONS CAREFULLY. 1. January 1: If Tiger sold, on net/30 credit terms, a Pinnacle with the 5-year extended warranty as a package, prepare all of the applicable journal entry or entries at the date of the delivery associated with the sales 2. January 5: Assume that Tiger transfers the $19,200 account receivable to Factoring Company for cash on a with-recourse basis. Tiger agrees with Factoring Company that a holdback of $700 is appropriate. Factoring Company pays Tiger $15,760 cash. Prepare the journal entry or entries to reflect the above situation 3. January 1: Ignore your answers to parts (1) and (2). Assume Tiger sells one Pinnacle to a customer without any extended warranty (only the Pinnacle itself is sold) on the following terms: a. Cash down pavment of $3.000.

READ THE BELOW QUESTIONS CAREFULLY. 1. January 1: If Tiger sold, on net/30 credit terms, a Pinnacle with the 5-year extended warranty as a package, prepare all of the applicable journal entry or entries at the date of the delivery associated with the sales 2. January 5: Assume that Tiger transfers the $19,200 account receivable to Factoring Company for cash on a with-recourse basis. Tiger agrees with Factoring Company that a holdback of $700 is appropriate. Factoring Company pays Tiger $15,760 cash. Prepare the journal entry or entries to reflect the above situation 3. January 1: Ignore your answers to parts (1) and (2). Assume Tiger sells one Pinnacle to a customer without any extended warranty (only the Pinnacle itself is sold) on the following terms: a. Cash down pavment of $3.000.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 10E

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