The accounting records of Atkinson Books showed a balance of \($2,000\) in Estimated Warranty Payable at December 31, 2009. In the past, Atkinson’s warranty expense has been 6% of sales. During 2010, Atkinson made sales of \($329,000\) on account and paid \($6,000\) to satisfy warranty claims.

Requirements

1. Journalize Atkinson’s sales, warranty expense, and cash payments made to satisfy warranty claims during 2010. Explanations are not required.

2. What balance of Estimated Warranty Payable will Atkinson report on its balance sheet at December 31, 2010?