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Computers Are Us sells PCs with a three-year warranty included. They expect that 50% of all claims will occur in the first year of the
Computers Are Us sells PCs with a three-year warranty included. They expect that 50% of all claims will occur in the first year of the warranty; 40% in the second year; and 10% in the third year. They expect, on average, $100 worth of claims per computer. What warranty liability and expense will they record when each computer is sold?
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