A company introduced a new product this year that carries a two-year warranty against manufacturer's defects. Based on their experience with previous product introductions, warranty costs are expected to approximate 2% of sales. Sales and actual warranty expenditures for the first year of selling the product were: Sales $5,840,000 Actual Warranty Expenditures $ 42,500 Required: 1. Does this situation represent a loss contingency? 2. Prepare journal entries that summarize sales of the product (assume all credit sales) and any aspects of the warranty that should be recorded during the year. 3. What amount should the company report as a liability at December 31 of this year? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Does this situation represent a loss contingency? Loss contingency Required 1 Required 2 >

Prepare journal entries that summarize sales of the product (assume all credit sales) and any aspects of the warranty that should be recorded during the year. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. A company introduced a new product this year that carries a two-year warranty against manufacturer's defects. Based on their experience with previous product introductions, warranty costs are expected to approximate 2% of sales. Sales and actual warranty expenditures for the first year of selling the product were: Required: 1. Does this situation represent a loss contingency? 2. Prepare joumal entries that summarize sales of the product (assume all credit sales) and any aspects of the warranty that should be recorded during the year. 3. What amount should the company report as a liability at December 31 of this year? Complete this question by entering your answers in the tabs below. What amount should the company report as a liability at December 31 of this year? A company introduced a new product this year that carries a two-year warranty against manufacturer's defects. Based on their experience with previous product introductions, warranty costs are expected to approximate 2% of sales. Sales and actual warranty expenditures for the first year of selling the product were: Required: 1. Does this situation represent a loss contingency? 2. Prepare journal entries that summarize sales of the product (assume all credit sales) and any aspects of the warranty that shoulc be recorded during the year. 3. What amount should the company report as a liability at December 31 of this year? Complete this question by entering your answers in the tabs below. Does this situation represent a loss contingency