What would be the adjusting entry to be made for 2021 if the company ascertain whether actual warranty cost approximate the estimate assuming sales and warranty repairs made evenly during the year? a. A debit to Warranty Expense and credit to Estimated Warranty Liability of Php192,500b. A debit to Estimated Warranty Liability and credit to Warranty Expense of Php192,500c. A debit to Estimated Warranty Liability and credit to Retained Earnings of Php192,500d. No adjusting entry to be made The selling price of Maning-Mani Appliances Company's unit isPhp10,000 each. The buyers are provided with a 2-year warrantythat is expected to cost the company Php1,000 per unit in theyear of sale and Php2,000 per unit in the year following the saleThe company sold 400 units in 2021 and 250 units in 2022.Based on company estimates, 20% of the units sold are repairedin the first year and 40% in the second year. Payments for warrantyrepairs were Php220,000 and Php300,000 in 2021 and 2022,respectively.

An expenditure connected to the repair, replacement, or reimbursement of a user for any product…

The selling price of Maning-Mani Appliances Company's unit is Php10,000 each. The buyers are provided with a 2-year warranty that is expected to cost the company Php1,000 per unit in the year of sale and Php2,000 per unit in the year following the sale The company sold 400 units in 2021 and 250 units in 2022. Based on company estimates, 20% of the units sold are repaired in the first year and 40% in the second year. Payments for warranty repairs were Php220,000 and Php300,000 in 2021 and 2022, respectively.

The selling price of Maning-Mani Appliances Company's unit is Php10,000 each. The buyers are provided with a 2-year warranty that is expected to cost the company Php1,000 per unit in the year of sale and Php2,000 per unit in the year following the sale The company sold 400 units in 2021 and 250 units in 2022. Based on company estimates, 20% of the units sold are repaired in the first year and 40% in the second year. Payments for warranty repairs were Php220,000 and Php300,000 in 2021 and 2022, respectively.

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter5: Introduction To Business Expenses

Section: Chapter Questions

Problem 63P

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