We-Win Law Services received a payment of $56,000 as a retainer for a legal client for services to be performed for five months. By December 31, 2021, We-Win had earned 36% of the retainer. Assuming the appropriate year-end adjustments have been made, the 2021 balance in We-Win's Unearned Revenue account will be:
On October 1, 2021, We-Win Law Services received a payment of $56,000 as a retainer for a legal client for services to be performed for five months. By December 31, 2021, We-Win had earned 36% of the retainer. Assuming the appropriate year-end adjustments have been made, the 2021 balance in We-Win's Unearned Revenue account will be:
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$35,840 |
|
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$20,160 |
|
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$33,600 |
|
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$22,400 |
4
Sales made in 2021 for $3,000,000 includes a 2-year warranty coverage, included in the price. The estimated cost for warranty is expected to be 2% for the first year and 5% for the second year. How much warranty expense should be recorded in 2021?
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$60,000 |
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$150,000 |
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$100,500 |
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$210,000 |
5
Lapalette Inc. is being sued by a customer for $500,000 related to damages from the sale of defective products. Legal counsel has advised Lapalette that there is a 70% likelihood that the company will be found liable; however, the normal settlement for this type of case is between $200,000 and $350,000, with payouts within this range equally likely. Lapalette follows ASPE. Based on this information, what amount should Lapalette record as a
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$275,000 |
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$350,000 |
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$200,000 |
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$192,500 |
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