Finisher Inc. sells merchandise of ($ 250,000) in 2020 that includes a three-year limited warranty. Warranty costs

Question:

Finisher Inc. sells merchandise of $\$ 250,000$ in 2020 that includes a three-year limited warranty. Warranty costs are estimated to be $1 \%$ of sales. The company incurred actual costs of $\$ 800$ in 2020 related to the warranties.

a. Record the warranty accrual at the time of sale in 2020.

b. Record the adjustment to the warranty accrual for actual warranty costs in 2020.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Intermediate Accounting Volume 2

ISBN: 9781618533135

2nd Edition

Authors: Hanlon, Hodder, Nelson, Roulstone, Dragoo

See More Books

Question Posted: May 24, 2024 06:05 AM

See More Questions

Hello, you already did chapter 1 and 2 of my MASTERS Thesis already for me. (See attached) So normally you know masters thesis consist of 5 chapters right ??..... But in this case my thesis will be 4...
1.Which of the following below is NOT an element of internal control? a. risk assesment b. monitoring c. information and communication d. behavior analysis ANSWER:D 2. Which of the following below is...
Brooks Corporation sells portable computer equipment with a two-year warranty contract that requires the corporation to replace defective parts and provide the necessary repair labour. During 2014,...
Your restaurant has five menu choices for lunch. How many ways can you order them on your menu? A 0.0749 B 0.0747 120
a) Generally, when does an agreement concerning an exchange of promises require performance to be exchanged? b) On what authority did the court rely in determining whether to award restitution in...
You are a PA in an accounting firm that has 10 offices in three provinces. Mr. Shine has approached you with a request for an audit. He is president of Hitech Software and Games Inc., a five-year-old...
Why might a subsidiary decide to issue new shares ofcommon stock to parties outside the business combination? LO4
Suppose that for health reasons, the government of the nation of Ironia wants to increase the amount of broccoli citizens consume. Which of the following policies could be used to achieve the goal?...
thanks in advance Using the free cash flow valuation model to price an IPO Assume that you have an opportunity to buy the stock of Alumina Tech Ltd., an IPO being offered for 14.20 per share....
Madison Co. sells merchandise of $\$ 250,000$ in 2020, along with a two-year warranty (for years 2020 and 2021) for $\$ 25$ per product. Warranty costs are estimated to be $0.5 \%$ of sales....
On December 31, 2020, Mainstreet Inc. has a \$100,000 note payable due on demand or on June 30, 2025, whichever is earlier, to First Bank. The repayment of the note by First Bank is not expected at...
Lester Enterprises' comparative balance sheets included inventory of $90,200 at December 31, 2011, and $70,600 at December 31, 2012. Lester's comparative balance sheets also included accounts payable...
What Do You Know About Amazon Associate Program? What Would You Do To Increase Your Earnings With Amazon Associate Program? Is Affiliate Marketing And Referral Marketing One And The Same? What is...
As a leader, what do you think are important elements of a leadership team made up of those senior people that you will surround yourself with? Do you have (or have you had) a mentor? If so, how have...
What role do interorganizational relationships and alliances play in achieving strategic goals, and how do organizations manage these relationships to ensure mutual benefit and minimize risks ?
How do expatriate managers normally rotate into the operations of a foreign country? How long do they typically stay in the country? What are the disadvantages? How did Shane Tedjarati rotate into...
If you are not Asian, do you know someone well who is Asian? In what capacity do you know them (e.g., personal friend, manager, classmate, neighbor, etc.)? Do you know their ethnic origin (e.g.,...
What is the difference between an Enterprise Fund and an Internal Service Fund?
Suppose that a flow network G = (V, E) violates the assumption that the network contains a path s t for all vertices V. Let u be a vertex for which there is no path s u t. Show that there must...
In 2019, Sunland Company had a break-even point of $388,000 based on a selling price of $5 per unit and fixed costs of $155,200. In 2020, the selling price and the variable costs per unit did not...
11. String Conversion Given a binary string consisting of characters '0's and '1', the following operation can be performed it: Choose two adjacent characters, and replace both the characters with...
Consider the table shown below to answer the question posed in part a. Parts b and c are independent of the given table. Callaway Golf (ELY) Alaska Air Group (ALK) Yum! Brands (YUM) Caterpillar...

Finisher Inc. sells merchandise of ($ 250,000) in 2020 that includes a three-year limited warranty. Warranty costs

Question:

Step by Step Answer:

Intermediate Accounting Volume 2

Students also viewed these Business questions