15 Required information Problem 9-4A (Algo) Estimating warranty expense and liability LO P4 (The following information applies to the questions displayed below.) On October 29, Lobo Company began operations by purchasing razors for resale. The razors have a 90 day warranty. When a razor is returned, the company discards it and mails a new one from Merchandise Inventory to the customer. The company's cost per new razor is $15 and its retail selling price is $70. The company expects warranty costs to equal 8% of dollar sales. The following transactions occurred. November 11 Sold 60 razors for $4,200 cash. November 30 December 9 December 16 December 29 December 31 January 5 January 17 Recognized warranty expense related to November sales with an adjusting entry. Replaced 12 razors that were returned under the warranty. Sold 180 razors for $12,600 cash. Replaced 24 razors that were returned under the warranty. Recognized warranty expense related to December sales with an adjusting entry. Sold 120 razors for $5,400 cash. Replaced 29 razors that were returned under the warranty. January 31 Recognized warranty expense related to January sales with an adjusting entry. Problem 9-4A (Algo) Part 1 Required: 1. Prepare journal entries to record above transactions and adjustments.. View transaction list View transaction list Journal entry worksheet < 2 3 4 5 6 7 8 ..... 12 Record the sales revenue of 60 razors for $4,200 cash. Note: Enter debits before credits. Date November 11 General Journal Debit Credit Required: 1. Prepare journal entries to record above transactions and adjustments. View transaction list Journal entry worksheet < 1 2 3 4 5 6 7 8 12 > Record the cost of goods sold for 60 razors. Note: Enter debits before credits. Date November 11 General Journal Debit Credit 1. Prepare journal entries to record drove as a View transaction list Journal entry worksheet < 1 2 4 5 6 7 8 12 Record the estimated warranty expense at 8% of November sales. Note: Enter debits before credits. Date November 30 General Journal Debit Credit ok View transaction list Journal entry worksheet t < 1 inces 2 3 JA 5 6 7 8 12 Record the replacement of 12 razors that were returned under the warranty. Note: Enter debits before credits. Date December 09 General Journal Debit Credit View transaction list Journal entry worksheet Dok ant < 1 ences 2 3 4 5 6 7 8 12 ***** Record the sales revenue of 180 razors for $12,600 cash. Note: Enter debits before credits. Date December 16 General Journal Debit Credit ets eBook View transaction list Journal entry worksheet Print < 1 2 3 4 5 ferences Record the cost of goods sold for 180 razors. Note: Enter debits before credits. Date December 16 6 7 8 CO 12 General Journal Debit Credit View transaction list Journal entry worksheet k < 1 2 3 4 5 6 3 8. 12 ces Record the replacement of 24 razors that were returned under the warranty. Note: Enter debits before credits. Date December 29 General Journal Debit Credit View transaction list Journal entry worksheet < 2 3 4 5 6 7 G Record the estimated warranty expense at 8% of December sales. Note: Enter debits before credits. Date December 31 12 22 General Journal Debit Credit > View transaction list Journal entry worksheet < 1 5 6 7 8 ces & Record the sales revenue of 120 razors for $8,400 cash. Note: Enter debits before credits. Date January 05 10 11 1. 12 12 General Journal Debit Credit View transaction list Journal entry worksheet < 1 5 es 16 7 8 9 10 11 " Record the cost of goods sold for 120 razors. Note: Enter debits before credits. Date January 05 12 General Journal Debit Credit Journal entry worksheet < 1 5 6 7 8 es 6 10 10 11 12 Record the replacement of 29 razors that were returned under the warranty. Note: Enter debits before credits. Date January 17 General Journal Debit Credit Journal entry worksheet < 5 6 7 8 9 10 11 Record the adjusting entry for warranty expense for the month of January. Note: Enter debits before credits. Date January 31 General Journal Debit Credit December 29 December 31 January 5 January 17 Replaced 24 razors that were returned under the warranty. Recognized warranty expense related to December sales with an adjusting en Sold 120 razors for $8,400 cash. Replaced 29 razors that were returned under the warranty. January 31 Recognized warranty expense related to January sales with an adjusting ent Problem 9-4A (Algo) Part 2 2. How much warranty expense is reported for November and for December? Warranty expense for November Warranty expense for December ices under the warranty January 31 Recognized warranty expense related to January sales wit Problem 9-4A (Algo) Part 3 3. How much warranty expense is reported for January? Warranty expense January 31 Recognized warranty expense related to January sales with an adjusting Problem 9-4A (Algo) Part 4 4. What is the balance of the Estimated Warranty Liability account as of December 31? Estimated warranty liability balance S < Prev 56 of 7 January 5 January 17 January 31 Sold 120 razors for $8,400 cash. CARS WAR an adjustin Replaced 29 razors that were returned under the warranty. Recognized warranty expense related to January sales with an adjusting Problem 9-4A (Algo) Part 5 5. What is the balance of the Estimated Warranty Liability account as of January 31? Estimated warranty liability balance