Consider the following: (Click the icon to view the information.) Requirement 1. For each item, indicate how the financial statements will be affected Identify the affected accounts specifically. 1. Orange Corporation sells electric appliances, including washing machines. On January 1, 2012. Orange had a liability of $240 million for future warranty claims. Suppose that experience in recent years has indicated that warranty costs for washing machines average 5.2\% of sales, and sales of washing machines for January 2012 were $900 million. During January Orange paid $43.65 million to service warranties on previously sold washing machines. 2. In lowa customers buying soft drinks pay a 5 deposit on each bottle on can purchased. (Many other states and countries have similar laws.) The bottler/distributor then pays 5 plus a 1 handling fee for each returned bottle or can. About 86% of the bottles and cans are redeemed. Suppose PepsiCo sold 2.18 million bottles of soda in August and paid $94,000 for bottles returned. 3. Planet Bank received a $5,000 savings deposit on January 1. On April 30, it recognized interest thereon at an annual rate of 6%. On May 1, the depositor closed her account with the bank. 4. Suppose The Visionary Theater Company sold for $240,000 cash a "season's series" of tickets in advance of December 31 for four performances, each to be held in successive months beginning in January. (a) What is the effect on the balance sheet. December 31? (b) What is the effect on the balance sheet, January 31? statement if not affected by the item, select "Not Affected" in the Accounts column of the first line below that statement label. For each financial statement, select each account only once. Input the gross increase and/or the gross decrease amount in each respective column. Leave any unused cells blank.) 1. Orange Corporation sells electric appliances, including washing machines. On January 1, 2012, Orange had a liability of $240 million for future warranty claims. Suppose that experience in recent years has indicated that warranty costs for washing machines average 5.2% of sales, and sales of washing machines for January 2012 were $900 million. During January Orange paid $43.65 million to servic warranties on previously sold washing machines. (Assume all sales are made on credit) 2. In lowa customers buying soft drinks pay a 5& deposit on each botlle or can purchased. (Many other states and countries have similar laws.) The bottlen distributor then pays 5% plus a 1$ handing fee for each retumed bottle or can. About 86% of the bottles and cans are redeemed Suppose PepsiCo sold 2.18 million bottles of soda in August and paid $94,000 for bottles returned. 3. Planet Bank received a $5,000 savings deposit on January 1. On April 30, it recognized interest thereon at an annual rate of 6%. On May 1, the depositor closed her account with the bank. (Round your answer to the nearest cent) 4 (a). Suppose The Visionary Theater Company sold for $240,000 cash a "season's series" of tickets in advance of December 31 for four performances, each to be held in successive months beginning in January. What is the effect on the balance sheet, December 31 ? 4 (b). What is the effect on the balance sheet, January 31
