Accounting for uncollectible accounts and warranties. Hurley Corporation sells household appliances (for example, refrigerators, dishwashers) to customers on account. The firm also provides warranty services on products sold. Hurley estimates that 2 percent of sales will ultimately become uncollectible and that warranty costs will equal 6 percent of sales. Actual uncollectible accounts and warranty expenditures generally occur within three years of the time of sale. Amounts in selected accounts appear below.

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December 31: Year 8 Year 9 Year 10 Estimated Warranty Liability.... Accounts Receivable, net of Allowance for Uncollectible Accounts of $355 on December 31, Year 8, $405 on December 31, Year 9, and $245 on December 31, Year 10 .... $7,000 $7,750 $6,470 $1,325 $1,535 $1,720 Year 9 Year 10 $18,000 $16,000 For the Year: Sales Revenue .. a. Prepare an analysis that explains the change in the Allowance for Uncollectible Accounts account during Year 9 and Year 10. b. Prepare an analysis that explains the change in the Estimated Warranty Liability account during Year 9 and Year 10.